This A.I. leader has nearly tripled this year. Wall Street can't stop raving about it and neither can we

You can’t seem to keep Nvidia (NVDA) down lately. Nvidia closed at an all-time high of nearly $430 per share last Wednesday. The stock has basically tripled year to date in the artificial intelligence-driven enthusiasm that has recently been gripping Wall Street. Despite Tuesday’s down market, Nvidia gained ground for the seventh session in the past eight, thanks to several positive analyst notes, which only further support our bullish views. NVDA 5Y mountain Nvidia 5-year performance Jefferies reiterated its buy rating and so-called Franchise Pick designation. The analysts also increased their price target to $500 per share from $472 following discussions with CFO Colette Kress at a recent conference. Three key factors are behind Jefferies’ increased optimism. Increased visibility on near-term demand thanks to “diverse and astounding interest” across cloud service providers (CSPs), consumer internet, enterprise, high-performance computing (HPC), and supercomputing customers for generative AI solutions. Equally important, the strong demand is more about volume than higher prices and management believes that the adoption and implementation of generative AI can “fuel growth for several years.” Strong software opportunities ahead thanks to AI Enterprise , Omniverse , and advanced driver-assistance systems (ADAS) for vehicle manufacturers. The “tectonic shift in data center architecture” resulting from the end of Moore’s Law and the need to overhaul data centers, which have historically been CPU-focused, to a new accelerated computing architecture and GPUs, which is Nvidia’s bread and butter. (CPU stands for central processing units and GPU stands for graphics processing units. For a closer look at semiconductors, check out our chip industry guide .) Bernstein appears to echo this near-term bullish view on Nvidia, reiterating its outperform (buy) rating and $475-per-share price target. The analysts said that Nvidia remains in the best position to benefit from the wave of investment dollars going into artificial intelligence research, adding, “datacenter outlook stunned (and we would take the over vs. the under on numbers as we go through the rest of the year) while in the long term, we believe the overall opportunity remains enormous, and still early.” Not to be outdone, Evercore ISI was also out Tuesday with its own bullish note, reiterating its outperform rating and taking its price target up to $550 per share from $500. Here, the analysts took a longer-term view, with an updated Accelerated server model. In their view, assuming that data center overhauls reach about 20% (up from a mid-single-digit percentage share currently) by calendar year 2027, Nvidia stands to generate as much as $30 per share in earnings. Evercore derived its price target by assuming 25x that $30 figure and discounting back to calendar year 2024, using a 10% discount rate . The analysts said, “There is still PLENTY of runway ahead — where we would actually not be surprised to see NVDA trading as the most valuable company over the next couple of years as generative AI continues its proliferation and drives acceleration in more servers over time.” However, the did concede that near-term consolidation would not be unexcepted given the stock’s’ year-to-date performance. Bottom line Ultimately, we side with the analysts on this one. While some may remain skeptical — scoffing that artificial intelligence is simply the buzzword of the moment — we continue to believe in the benefits that AI applications in general, and generative AI specifically, will have on consumers and business clients alike. With little competition to be had and all roads to accelerated computing leading back to Nvidia, we continue to think that long-term investors will ultimately be better rewarded by owning the stock for the long term, rather than trying to trade the swings and risk missing the bigger move to come in the years ahead. That’s why Nvidia is only Jim Cramer’s second own-it, don’t-trade-it stock. ( Apple , also a long-time Club name, was the first.) (Jim Cramer’s Charitable Trust is long NVDA, AAPL. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.