Nvidia Stock Nears All-Time High. How Earnings Could Push Shares Even Higher.

Nvidia chips are the favored choice for training artificial-intelligence models. (Akio Kon/Bloomberg)

Key Points

• Nvidia shares rose 2.2% to $190.42 in premarket trading, nearing its record closing high of $192.57.
• Market optimism for Nvidia is tied to coming earnings from major tech companies and their AI investment plans.
• Demand for AI compute is significant, with a Saudi-based AI start-up planning six gigawatts of data-center capacity.

Nvidia neared its all-time high on Monday, reaping the rewards of Wall Street’s optimism about Big Tech earnings that are coming this week.

In midmorning trading, the chip maker’s shares were up 2.4% at $190.77. The S&P 500 was ahead 0.8%. The stock reached a record closing high of $192.57 on Oct. 9, according to Dow Jones Market Data.

Shares have largely moved sideways since August but are now poised to drive toward $200 for the first time, depending on earnings reports from Microsoft , Google-parent Alphabet , Amazon.com, and Meta Platforms and whether they are determined to keep investing in artificial intelligence.

“Most of the focus during mega cap earnings week will remain on the growth of AI compute demand, which we believe is still significant,” wrote D.A. Davison analyst Gil Luria in a research note. “We expect Nvidia’s largest customers to continue their capex trajectory, which they are now enhancing with buildout by neoclouds.”

Luria has a Buy rating and $210 target price on Nvidia stock.

Demand isn’t only coming from the U.S.

Also on Monday, Saudi-based AI start-up Humain said it plans to build six gigawatts of data-center capacity to support an AI computer-operating system that allows users to tell a computer to perform tasks, Reuters reported.

Two other chip makers were also up in morning trading. Advanced Micro Devices was rising 1.1% and Broadcom was up 1.9%.

Write to Adam Clark at adam.clark@barrons.com