Bank of America analysts said Nvidia remains the top AI compute stock to buy despite its underperformance so far this year [1, 2].
The recommendation comes as investors weigh the long-term viability of artificial intelligence spending against short-term stock volatility. Because Nvidia's chips power the majority of large-scale AI models, the firm's outlook serves as a bellwether for the broader semiconductor industry [3, 2].
In research notes and a CNBC interview, Bank of America analyst Vivek Arya said the potential for agentic AI could drive an unprecedented chip cycle [4, 2]. Arya set a price target of $350 [1] for the stock, which was trading at $215 [1] at the time of the recommendation.
Analysts said that AI-related spending is likely to stay "stronger for longer" [3, 2]. This sustained investment suggests that the demand for high-performance compute remains robust even as other sectors of the market fluctuate.
While some market observers have questioned if challengers are emerging to disrupt Nvidia's dominance in 2026, Bank of America maintains its bullish stance [5, 2]. The firm's analysis suggests that the current scale of AI deployment justifies the valuation target despite the recent lag in share price [2].
Nvidia continues to maintain a significant lead in the hardware required for generative AI. The firm's ability to iterate on its chip architecture allows it to capture the bulk of the spending from cloud service providers, and enterprises [2].
“Nvidia remains the top AI compute stock to buy despite its year‑to‑date underperformance.”
The Bank of America outlook suggests that the 'AI bubble' concerns are outweighed by the actual infrastructure requirements of agentic AI. By setting a price target significantly above the current trading price, analysts are signaling that they view the recent stock underperformance as a buying opportunity rather than a fundamental decline in the company's market power.
