Wall Street analysts keep one-upping each other to be biggest bull on red-hot Nvidia

Key Points
  • Nvidia shares have more than tripled in the last year, the best return of any stock in the S&P 500.
  • Bank of America Merrill Lynch predicts the company's shares will rise another 16 percent the next 12 months to $185, the highest price forecast on Wall Street.
  • Citi Research raised its Nvidia price target Thursday to a then Street high of $180.
Wall Street analysts keep one-upping each other to be biggest bull on red-hot Nvidia

Wall Street is falling over itself to have the most bullish call on Nvidia, the market's best-performing stock in the past year.

Right after Citi Research raised its Nvidia price target to a street high of $180 Thursday morning, another analyst decided to one-up its peer with a higher price target for the semiconductor company.

Bank of America Merrill Lynch analyst Vivek Arya on Thursday evening told investors to buy Nvidia shares, citing the large opportunity in the artificial intelligence market:

"NVDA is trading at a premium multiple, but the momentum could persist given: (1) Only 17% ownership by large-cap active US managers (vs. large-cap semi comps 25%-39% ownership; (2) Potential expanding ownership by Softbank vision fund, per media reports; and (3) Scarcity value as the only proven way to gain exposure to nascent AI/machine learning trend which could be a 10-20x growth opportunity. This weekend's E3 gaming show typically marks start of 2H seasonal strength."

SoftBank Group has bought a $4 billion stake in Nvidia, according to a Bloomberg News report last month.

Arya raised his price target on Nvidia to $185 from $155, representing 16 percent upside from Thursday's close. He now has the highest price target on the company out of 34 analysts, according to FactSet.

Nvidia shares have rallied 238 percent through Thursday in the previous 12 months compared with the market's 15 percent return in that period. That performance ranks No. 1 in the entire , according to FactSet. The shares are up 50 percent this year versus the market's 9 percent performance.

"We see strong upside to Street's 2H and 2018 estimates, with $7 in l-t EPS power," Arya wrote.

Nvidia shares rose 3 percent at Friday's market open.