As trading begins this week, Nvidia, the dominant force in artificial intelligence hardware, finds itself caught between robust analyst optimism and mounting geopolitical challenges. Market experts are highlighting the stock’s attractive valuation and raising price targets, even as fresh supply chain disruptions in a key market create uncertainty. The central question for investors is whether the company’s strong fundamentals can outweigh these renewed operational pressures.
Supply Chain Friction in a Critical Market
Counterbalancing the positive sentiment are tangible new obstacles emerging in Asia. According to recent reports, suppliers have halted production of components for Nvidia’s H200 chip. This stoppage is a direct result of customs authorities in Shenzhen blocking import clearances. These regulatory bottlenecks are already triggering order cancellations, as customers have limited ability to switch to alternative configurations.
While Nvidia’s direct revenue exposure to China has declined to under 10%, a significant drop from the historical range of 20-25%, the current disruption threatens potential high-margin revenue estimated at approximately $30 billion for the region. Despite commanding roughly 80% of the AI accelerator market, analysts at firms like RBC Capital Markets project this share could fall to 70% by 2027. This anticipated erosion is attributed to growing competition from AMD and the internal chip development efforts of major cloud service providers.
Compelling Valuation Attracts Analyst Upgrades
The most bullish recent commentary originates from RBC Capital Markets. The firm initiated coverage with an “Outperform” rating and a $240 price target. This target implies an upside potential of about 29% from Friday’s closing price.
Should investors sell immediately? Or is it worth buying Nvidia?
RBC’s thesis is heavily grounded in valuation metrics. The analysts note that Nvidia is currently trading at just 24 times estimated earnings for fiscal year 2027. This represents a 50% discount compared to its average valuation in the three years preceding the AI boom. RBC also points to the capital expenditure plans of major cloud providers, which are forecast to grow by 40% in 2026—a direct catalyst for future orders at Nvidia.
Another firm, Jefferies, also characterizes the stock as “quite inexpensive,” raising its price target to $275 last Friday. Their focus rests on the product roadmap through 2028, specifically the Blackwell and Rubin platforms. Confidence in the market adoption of this new hardware was bolstered by Bitzero Holdings’ confirmed purchase of eight Blackwell B300 servers yesterday.
The Road Ahead: Key Dates and Levels
For shareholders, the next critical milestone is February 25, 2026, when the company is scheduled to release its quarterly results. Investor attention will be fixed not only on the margin profile of the new Blackwell chips but, more importantly, on management’s commentary regarding sales trends in China. In the near term, the stock’s all-time high of $212.19 remains the key technical level that must be surpassed to signal a resumption of the upward trend.
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