Top analyst Gil Luria of DA Davidson weighed in on Nvidia’s (NVDA) $5 billion investment in Intel (INTC), calling the move a “strategic win” for both companies. Along with the investment, the deal also includes a long-term plan to build custom chips for data centers and PCs. The 5-star analyst said NVIDIA is pushing the AI boom forward, while also helping Intel grow as the main U.S. chip foundry.
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According to Luria, Intel gains stronger backing from Washington and the tech industry, along with more demand for its chip packaging services. Meanwhile, Nvidia keeps its lead in AI by ensuring supply and support across the wider chip market.
It is worth noting that Luria ranks 452 out of more than 10,026 analysts tracked by TipRanks. He has a success rate of 59%, with an average return per rating of 17.10% over a one-year timeframe.
Why NVIDIA Is Investing in Intel
DA Davidson noted that Nvidia’s $5 billion investment marks a clear shift in how the company sees the industry. While NVIDIA and Intel were once viewed as direct rivals, the analyst explained that this is no longer true. Today, NVIDIA holds the majority of demand for AI chips, and rather than focusing on competition, it is investing in ways to strengthen the broader AI market.
By supporting Intel, Nvidia is strengthening its lead in AI while also helping the wider AI market grow. The analyst pointed out that the deal gives Nvidia more flexibility in CPU design, allowing it to diversify beyond its current Arm-based processors that are manufactured by Taiwan Semiconductor Manufacturing Company (TSM).
Just as important, the investment supports U.S. government plans to expand domestic semiconductor production. By working with Intel’s foundry, Nvidia builds a closer tie to Washington’s push for more local chip capacity, which could help secure supply for AI products in the future.
What Is the 12-Month Price Target for Nvidia?
According to TipRanks, NVDA stock has a Strong Buy consensus rating based on 36 Buys, two Holds, and one Sell assigned in the last three months. At $211.11, the Nvidia average stock price target implies a 20.7% upside potential.
