Daiwa Capital Markets analysts upgraded Nvidia (NASDAQ:NVDA) stock to Outperform from Neutral, citing “higher conviction of position.”

The NVDA stock price target is hiked to $475 per share, up from the prior $408, reflecting raised FY24/25 above-Street estimates.

“Post our recent tech tour and checks, we have a higher level of confidence that Nvidia’s commanding position for AI, and Generative AI, will be difficult to replicate near term by the competitors such as AMD, Intel and others. Why? AI benefits most from a full scale solution,” analysts wrote in a client note.

The analysts were previously concerned about weak cloud and Enterprise hardware demand in 2023. They acknowledge that Daiwa analysts were “massively wrong” when it comes to the importance of generative AI to the world.

“We obviously missed the huge jump in the shares, but this is the beginning of what we believe to be a new technology era. Every company will want to not only use something like ChatGPT, based on public data, but also do the same with their own internal data. GPUs are essential for training, which can be considered a ‘new’ market,” the analysts said.