Rising 3.5% on Friday, Nvidia (NASDAQ:NVDA) shares extended the 3% increase of the previous session, steering the “Magnificent Seven” stocks to a good start to 2025. The gains follow a late-2024 sell-off marked by significant declines in major tech companies absent a normal “Santa Claus rally.”
Nvidia’s stock declined 4% between December 24 and December 31; Tesla’s (TSLA) plunged 13%. While Meta Platforms (NASDAQ:META), Alphabet (GOOG,GOOGL), and Apple (AAPL) had falls of just under 4%, Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) each fell over 4%.
Supported by strong demand for its artificial intelligence-oriented processors, Nvidia ended 2024 with a more than 150% yearly gain despite year-end turbulence. Analysts are still upbeat; Wall Street consensus shows shares might climb from their current level of $138 to $173.
Vivek Arya of Bank of America blamed a sector rotation from semiconductors to software and company-specific issues moving to its next-generation Hopper chip platform for Nvidia’s late-year downturn. He said the change represents “growing pains” but underlined the company’s solid long-term positioning in the AI space. The comeback by Nvidia highlights growing market confidence as tech equities heal to start the new year.
This article first appeared on GuruFocus.