Barclays Sees a $200 Path for Nvidia Stock

Nvidia (NASDAQ:NVDA) had a rocky start to the year defined by a set of worries; the rise of Chinese startup DeepSeek, delays in ramping up its Blackwell chips, and concerns over new U.S. restrictions on sales to China. But the stock has since shrugged off those headwinds. In fact, since the market dip triggered by Trump’s tariff announcement in early April, Nvidia’s rebound has outpaced the broader market, with shares now up 53%.

Barclays analyst Tom O’Malley believes there’s more gas in the tank here, noting: “Even with the recent run, this name has the most potential upside in our coverage for the 2H.”

Backing that view, O’Malley just raised his price target on NVDA from $170 to $200, suggesting the shares could climb another 38% over the next 12 months. He continues to rate the stock Overweight (i.e., Buy).(To watch O’Malley’s track record, click here)

What’s fueling this bullish outlook? O’Malley expects Nvidia to beat expectations in the second half of the year, driven by stronger-than-anticipated Compute revenue. He now sees about $2 billion in upside for the July quarter alone compared to consensus forecasts and has lifted his Compute revenue estimate to $37 billion, up from $35.6 billion. While Blackwell chip production is ramping more slowly than hoped (30,000 wafers per month in June versus the expected 40,000), utilization remains strong, and supply chain feedback “sounds positive” for the back half of the year. That, the analyst says, aligns with increasing demand for Agentic AI applications.

Despite the slower ramp, production is still scaling at a 30% quarter-over-quarter clip. Combined with solid utilization, this gives O’Malley added conviction heading into the October quarter. He now anticipates mid-teens QoQ growth in Compute revenue for both Q3 and Q4, even without meaningful contributions from Hopper or China.

Accordingly, O’Malley has revised his Compute revenue estimates for Q3 and Q4 to $42 billion and $48 billion, respectively – ahead of Street consensus figures of $40.8 billion and $46.2 billion. Meanwhile, Nvidia’s next-gen Blackwell Ultra chip appears on track, with small volumes expected in the supply chain by the quarter’s end and mass production starting in Q3.

System sales are also picking up. O’Malley estimates they’ll represent around 25% of July revenue and could climb to nearly 50% by October. Both the Ultra rollout and rising volumes are expected to support margin expansion in the second half.

Barclays’ confident stance is echoed across Wall Street. Nvidia holds a Strong Buy consensus rating, based on 35 Buys, 4 Holds, and just 1 Sell. The $173.19 average price target implies a 19% upside from current levels. (See NVDA stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.