BlockBeats News, August 19, Bank of America analyst Vivek Arya stated that the market may currently be overestimating the risks facing the artificial intelligence (AI) investment cycle, leading to an undervaluation of NVIDIA's stock price, with its valuation potentially underestimated by 34% to 50%.

In his latest research report, Arya reiterated a "Buy" rating on NVIDIA and maintained a $350 price target. Based on this target price, NVIDIA's stock price still has significant room for upward movement from its current level.

Despite recent pressure on AI concept stocks, with investors continuing to worry about a slowdown in AI infrastructure investment, the commercialization progress of enterprise AI, and valuation pressures, Bank of America believes that the market has overly priced in these risks.

Arya stated that NVIDIA remains at the core of AI computing infrastructure, and its GPU products, software ecosystem, and collaboration with cloud computing vendors give the company a continued advantage in benefiting from the growth in AI computing power demand. He believes that the current market's concerns about the sustainability of the AI cycle may be overshadowing NVIDIA's long-term growth potential.

Bank of America has previously been optimistic about NVIDIA's leading position in the AI data center field, believing that as generative AI applications expand, the demand from enterprises and cloud service providers for high-performance computing resources will continue to support NVIDIA's future performance growth.