Nvidia stock surged due to AI developments, but DeepSeek's claims caused a drop

From Nasdaq: 2025-01-29 03:25:00

Recent developments in AI, particularly generative AI, are driving a bull market with promises of increased productivity. Nvidia has benefited significantly from this trend, with its GPUs fueling a 500% stock surge. However, claims by Chinese start-up DeepSeek have caused a 17% stock drop and $600 billion loss in market cap.

Despite DeepSeek’s claims, skepticism remains about the cost and development of its AI models. Wall Street analysts believe that lower-cost AI models will drive increased adoption and demand for Nvidia’s processors. With a strong buy rating and a potential 71% upside, Wall Street remains bullish on Nvidia.

A roundtable discussion among Fool analysts highlighted doubts about DeepSeek’s claims, including the cost of training its chatbot and discrepancies in app downloads. While Nvidia faced volatility post-DeepSeek, it is likely to continue playing a crucial role in AI development. Investors should expect more developments in the AI field.

The Motley Fool Stock Advisor team did not include Nvidia in its list of 10 best stocks to buy now, citing the potential for monster returns from the selected stocks. Despite this, Nvidia has a history of innovation and growth, making it a worthwhile investment according to some analysts.



Read more at Nasdaq: Should You Buy Nvidia Stock in the Wake of the DeepSeek Bombshell? Here’s What Wall Street Is Saying.