NVIDIA (NVDA) Stock: Street Analysts See More Gains Ahead After Price Target Hike

TLDR

• Jefferies raised its NVIDIA price target to $275 from $250 on January 16
• The firm believes NVIDIA trades cheaply at mid-teens multiple for 2027 earnings
• NVIDIA and Eli Lilly announced a $1 billion AI lab partnership for drug discovery
• J.P. Morgan reaffirmed its Buy rating on the stock January 13
• Analysts expect earnings beats and rising estimates through upcoming quarters

NVIDIA received positive analyst attention this week. Jefferies raised its price target to $275 from $250 while maintaining a Buy rating.

NVIDIA Corporation, NVDA

The update came January 16. Analysts based the change on their accelerator builds model extending through 2028.

The firm told clients NVIDIA “remains pretty cheap” at current levels. The stock trades at mid-teens multiple compared to their 2027 earnings projections.

Jefferies sees additional upside beyond that timeframe. The bank expects material earnings beats with estimates climbing higher over several quarters.

J.P. Morgan also backed the stock with a Buy rating January 13. The firm did not provide a specific price target.

AI Drug Discovery Lab Gets $1 Billion Commitment

NVIDIA announced a partnership with Eli Lilly the same day as the Jefferies upgrade. The companies will create an AI co-innovation lab focused on pharmaceutical research.

CEO Jensen Huang revealed the plan at the J.P. Morgan Healthcare Conference in San Francisco. He joined Lilly CEO Dave Ricks for the announcement.

Both companies will invest up to $1 billion over five years. Funds will support infrastructure, talent acquisition, and computing power.

The facility will operate from the San Francisco Bay Area. Company executives called it a blueprint for future drug discovery.

Combining AI Power with Pharmaceutical Knowledge

The lab aims to solve complex biological modeling problems. NVIDIA contributes AI technology while Lilly provides pharmaceutical expertise.

Management described the challenge as one of humanity’s greatest scientific hurdles. The partnership targets breakthrough approaches to understanding biological systems.

Jefferies noted NVIDIA’s estimate revisions will likely be smaller than Broadcom’s. The firm named Broadcom its top semiconductor sector pick.

For Broadcom, Jefferies models 2028 earnings per share exceeding $19. Conservative estimates suggest $25 EPS potential based on OpenAI and Meta contracts.

NVIDIA operates through two main segments. The Compute & Networking division and Graphics Processing Unit business drive revenue.

Wall Street assigns the stock a Strong Buy consensus rating of 1.34. Revenue grew 65.22% over the trailing twelve months to $187.14 billion.

The current P/E ratio stands at 46.58. The PEG ratio of 0.77 suggests favorable valuation relative to earnings growth.

Analysts see continued momentum for the stock. The extended model through 2028 provides visibility for long-term growth.

The Lilly partnership opens new revenue opportunities in healthcare AI. Drug discovery represents a growing market for AI applications.

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