02. NVIDIA Corporation (NASDAQ:NVDA)
Upside Potential: 31%
As of January 16, financial institution KeyBanc has adjusted its evaluation of NVIDIA Corporation (NASDAQ:NVDA), a leading semiconductor manufacturer. KeyBanc has increased its price target on NVIDIA Corporation (NASDAQ:NVDA) shares from $670 to $750, indicating a substantial upside potential of 31%. Simultaneously, KeyBanc has reaffirmed an “overweight” rating for the company. The decision to elevate the price target to $750 underscores KeyBanc’s positive outlook on NVIDIA Corporation (NASDAQ:NVDA) future market performance. This adjustment signifies KeyBanc’s confidence in the company’s potential for significant appreciation in stock value, considering factors such as anticipated improvements in financial metrics, strategic initiatives, or positive trends within the semiconductor industry. The “overweight” rating emphasizes KeyBanc’s endorsement of NVIDIA as an attractive investment opportunity within the semiconductor sector. This rating suggests that KeyBanc believes NVIDIA Corporation (NASDAQ:NVDA) is well-positioned to outperform its industry peers, and investors should consider it favorably within the competitive landscape of semiconductor manufacturing.
In its fourth quarter 2023 investor letter, ClearBridge Large Cap Growth Strategy stated the following regarding NVIDIA Corporation (NASDAQ:NVDA):
“Much of that differential can be attributed to the performance of the Magnificent Seven (Alphabet, Amazon.com, Apple, Meta Platforms, Microsoft, Nvidia and Tesla), a basket of mega cap growth stocks that accounted for 47.8% of the benchmark return for the quarter and 65.4% for 2023.
The ClearBridge Large Cap Growth Strategy maintains exposure to six of the seven stocks, with overweights in Amazon.com, Meta and NVIDIA Corporation (NASDAQ:NVDA). Those three stocks, as well as Microsoft, were among the leading contributors to Strategy performance for the quarter. Microsoft and Nvidia continued to be supported by strong execution and leadership positions in the implementation of generative artificial intelligence (AI).
These are high-quality, cash flow generative businesses that we will continue to own, actively adjusting our positioning sizes based on risk/reward and portfolio construction priorities. With Nvidia shares more than tripling in 2023, we opportunistically took profits throughout the year, an approach that continued in the fourth quarter with additional trims that brought the position down to 6% of overall assets.
Active management of our mega cap exposure contributed to the Strategy outperforming the benchmark both in the fourth quarter and through the narrow leadership market of 2023. We also attribute these improved results to solid stock picking, being opportunistic in adding to or initiating new positions in growth companies at or near the bottom of their earnings cycle, and maintaining a commitment to diversification across our three buckets of growth: select, stable and cyclical.”
