Despite DeepSeek, Jensen Huang-led Nvidia is heading towards stardom; here's why

Even after the Chinese AI startup Deepseek's launch with low-quality chips, Nvidia's future is still optimistic, as the policies of Treasury Secretary Scott Bessent and US president Donald Trump have been credited as the company's growth driver, as per a report.

Nvidia’s Growth Optimism

Trump and Bessent's re-election, and continued emphasis on pro-business policies, particularly in areas of AI and innovation in the technology sector, will give a tremendous boost to the prospects of Nvidia in the long run, as per TipRanks report.

Tax Benefits and Corporate Growth

Nvidia will benefit from one of the pro-growth stances of the administration as Bessent’s latest remarks revealed a strategy favouring tax benefits for industries like AI and quantum computing, reported TipRanks. According to the report, low business taxes and sensible expense guidelines would increase Nvidia’s net income and earnings per share upward, boosting the company’s intrinsic value.

Deregulation and Infrastructure Projects

Even the expected deregulation to streamline infrastructure projects would benefit Nvidia because it would reduce the challenges for its data centre customers, according to TipRanks. While, easy approvals for major infrastructure might also lead to more AI projects, boosting Nvidia hardware sales, as per the report. The TipRanks also reported that the bullish projection for monetary policy, like a possible interest rate cut in late 2025, could lower financing costs for Nvidia’s customers, thus lengthening the AI investment cycle.

Wall Street’s Optimism

According to Wall Street analysis, Nvidia has a consensus strong 'Buy' rating based on 34 Buys, five 'Holds', and just one 'Sell' rating marked in the last three months, reported TipRanks. While, the average stock price target is $164.35, which shows a 40% upside potential in the next 12 months, as per the report.

FAQs

What policies are driving Nvidia’s growth?
Pro-business policies under President Trump and Treasury Secretary Scott Bessent, such as tax cuts and incentives for AI and quantum computing, are expected to fuel Nvidia’s growth, as per TipRanks.

How will tax policies affect Nvidia?
Lower corporate taxes and favourable expense guidelines will increase Nvidia’s net income and earnings per share, enhancing its overall value, as per the report.