Investing.com – Here are the biggest artificial intelligence (AI) analyst moves this week.
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2025 could be peak year for Nvidia stock: DA Davidson
In a note on Thursday, DA Davidson analysts suggested that 2025 could be a peak year for Nvidia (NASDAQ:) stock, while maintaining a cautious view on the company's long-term outlook.
Despite Nvidia's strong performance over the past year, the company has raised questions about its ability to meet 2026 expectations, describing its forecasts for that year as “low on the Street.”
DA Davidson began coverage of Nvidia in January 2024 with a Neutral rating, indicating significant concerns that placed the company among the most conservative voices on Nvidia's future prospects. This cautious stance remains unchanged, as the company reiterates its Neutral rating and price target of $135, reflecting a multiple of 35x.
“We remain cautious about NVDA's ability to meet consensus forecasts for 2026 and beyond,” the company's analysts said, stressing that although 2025 may represent a high point, sustaining growth beyond that could be difficult.
Among the company's main concerns are supply-side disruptions, including restrictions on sales to China and quality issues with Nvidia's Blackwell products. However, DA Davidson noted that these challenges could “actually prolong the cycle,” as supply constraints may help sustain demand in the near term.
However, DA Davidson predicts a potential slowdown in 2026.
“In the short term, we expect investors to focus on supply-side disruptions, i.e. restrictions on sales to China as well as quality issues at Blackwell,” the company commented, adding that “the driver in the long term will continue to be demand.”
Morgan Stanley sets Tesla's stock price at $800
Earlier in the week, Morgan Stanley (NYSE:) raised its price target on Tesla Inc (NASDAQ:) shares to $430 from $400, with a new bull case rating of $800.
The Wall Street firm attributes the upgrade to Tesla's advances in autonomous vehicle (AV) technology and its integration with embodied artificial intelligence, which are seen as critical drivers of future growth.
The report highlights Tesla's unique expertise in data collection, robotics, energy storage, and AI infrastructure, positioning the company as a leader in the autonomous mobility market.
Tesla Mobility, the company's autonomous ride-sharing division, is valued at $90 per share in an updated sum of the parts (SOTP) model. The division's fleet is expected to expand to 7.5 million vehicles by 2040, generating revenue of $1.46 per mile with an EBITDA margin of 29%.
Morgan Stanley also underscores the growing importance of Tesla's network services, which include recurring revenue streams such as Full Self-Driving (FSD), Supercharging, and software updates.
This segment is expected to account for a third of Tesla's total EBITDA by 2030, rising to nearly 60% by 2040. The Network Services division is now valued at $168 per share, reflecting its growing importance within the model Tesla's comprehensive business.
“We raised our price target to $430 from $400 previously, driven by increases in valuations for our mobility and grid services and partially offset by a decline in valuation for our third-party battery business,” analysts led by Adam Jonas wrote.
The bank notes that Tesla's potential in embodied AI extends beyond vehicles into areas such as aviation and marine, although these opportunities are not yet included in the assessment. Analysts expect Tesla's fleet of unattended self-driving vehicles to launch in a city by 2026, but they don't expect widespread deployment until after 2030.
The analysts added that while the incoming administration may reevaluate self-driving policies at the national level, Tesla still faces “significant hurdles” in technology, testing and permitting for commercialization in the near term.
Morgan Stanley's bullish case assumes a fleet size of 12 million vehicles by 2040, generating revenue of $1.50 per mile with an EBITDA margin of 45%, driven by international expansion and enhanced pricing power.
On the other hand, a bear case valuation of $200 per share reflects challenges such as stricter regulations and slower geographic adoption.
AMD's rating was downgraded at Wolfe Research
Wolfe Research downgraded shares of Advanced Micro Devices Inc (NASDAQ:) to Peer Performance from Outperform, indicating lower expectations for the company's data center GPU revenue in 2025.
Analysts now expect revenues of $7 billion for the sector, a sharp decline from the previous estimate of more than $10 billion.
“We now expect $7B in DC GPU revenue for CY25 versus our previous forecast of $10B+,” Wolfe Research wrote in a note. They also believe AMD will refrain from providing guidance for the segment during its upcoming Q4 earnings call.
The downgrade comes after visits to Asia, where ODM build plans suggested only modest growth for AMD.
“We estimate data center GPU revenues in the range of $1.5-2.0 billion for Q4 and $7 billion for FY25,” Wolfe analysts added, stressing that these numbers are well below buy-side expectations of roughly $10 billion.
The challenges extend to other parts of AMD's business as well. Analysts expect a 17% sequential decline in the customer segment for the first quarter of 2025 due to weak PC demand, a 20% decline in gaming revenue, and no immediate recovery in the embedded segment, which may improve later in the year.
In light of these adjustments, Wolfe Research lowered its 2025 forecast for AMD's total revenue and earnings to $29.9 billion and $4.19 per share, down from previous estimates of $33.6 billion and $5.33 per share.
On a more positive note, Wolfe Research expressed some optimism about AMD's upcoming MI350 series, scheduled for release in the second half of 2025.
TD Cowen raises SAP shares to buy
TD Cowen upgraded shares of SAP SE ADR (NYSE:) to Buy from Hold, raising the price target to $305 from $240.
The upgrade builds on survey data showing a significant rise in cloud ERP prioritization, with AI emerging as a key driver of ERP migration.
“Growth acceleration + margin expansion combination is expected to continue through 2727 and put further upward pressure on valuation,” analysts led by Derek Wood wrote in a note on Thursday.
Tdcoin 2025 programming (ETR:) Spending Survey reveals ERP has risen to third place out of 11 categories in SaaS spending priorities, up four spots from its previous ranking. Additionally, quarterly surveys of SAP partners in Q4 indicated improved performance and stronger growth expectations for 2025, with expectations rising to +7%, compared to +2% at the same time last year.
The company highlights strong demand for Cloud ERP, which showed resilience in 2024 and is expected to accelerate over the next three years. This growth is due to factors such as 2-3x revenue conversion on cloud migrations, end of life for SAP's legacy ECC product in 2027, and higher attach rates for adjacent products.
The company is also expected to benefit from lower bottlenecks from its IaaS and transactional products, along with increased average selling price (ASP) from new AI and data offerings.
According to TD Cowen, SAP is seeking to leverage AI in two main ways: as a catalyst to accelerate Cloud ERP migrations and by monetizing GenAI features in the Premium SKU, which provides a roughly 30% price increase.
For its upcoming Q4 earnings report on January 28, TD Coin expects SAP to hit another five-year high in cloud growth.
TD Cowen analysts are modeling cloud growth accelerating by roughly 200 basis points to about 29% in constant currency (cc), above Street expectations of about 28% cc. Furthermore, recent strength in the US dollar is expected to provide tailwinds, prompting TD Cowen to raise its FY25 estimates.
The combination of accelerating growth and expanding margins is expected to continue to drive upward momentum in SAP's valuation, analysts said.
Oppenheimer's Best Snowflake of 2025 Pick
Oppenheimer analysts have reconfirmed this Snowflake Company (NYSE:) as a top pick for 2025, citing strong expectations for the company's performance and strategic growth initiatives. The company also raised its price target on the stock to $200 from $180.
The positive outlook is based on several key factors that position Snowflake for potential outperformance.
First, Oppenheimer points to favorable preparation for fiscal 2026, with initial guidance in line with consensus that could provide slight upside.
Analysts expect a “fast and rising pace” throughout the year, driven by new product launches and increasing AI workloads. Innovations such as Snowpark, Dynamic Tables and Cortex are expected to drive consumption and accelerate revenue growth.
The investment bank also signals a shift in its view of the iceberg. While concerns about losing storage revenue in FY25 initially clouded the outlook, Oppenheimer now sees Iceberg as a growth catalyst in FY26. Analysts believe it will play an important role in boosting consumption and boosting Snowflake's revenue streams.
Momentum in Cortex and AI is another important driver, according to the note. As cloud independence and the Large Language Model (LLM) gain more attention, customers are increasingly motivated to build applications on the Snowflake platform, leveraging its advanced capabilities to handle AI workloads.
Finally, Oppenheimer expects operating margin to expand as investment levels normalize after a period of increased spending in FY25, creating opportunities for improved profitability.
“Online, we see good support for improving consumption with room for upside from new products, expanding use of AI, and better margins,” the analysts concluded.
