DeepSeek Just Updated Its AI Models. How Should You Play Nvidia Stock Here?

Nvidia (NVDA) is back in the investor spotlight thanks to another potential shakeup in the AI hierarchy. Chinese challenger DeepSeek quietly released an improved version of its V3 model — V3-0324— on Hugging Face without a formal release. The revision features drastic code execution and benchmark score upgrades, catching the market off guard and sparking weakness among U.S. tech names, including Nvidia.

The timing could not be more sensitive. Nvidia’s tear over the last year has been driven by its position as the de facto provider of choice for AI hardware. However, the arrival of low-cost, high-performing open-source challengers like DeepSeek could signal a shift. The question for investors now: Has Nvidia already priced in peak AI hype — or can the rally still run from here?

About Nvidia Stock

Nvidia (NVDA) is the globe’s premier GPU computing and AI infrastructure firm. Worth nearly $2.72 trillion, the company powers cloud data centers and graphics applications, as well as autonomous systems and AI training platforms.

NVDA shares have surged more than 1,700% in the past five years, delivering huge returns for long-term investors. In 2025, however, the shares have experienced a moderate pullback. Nvidia now trades near $110, down 6.6% in the last five trading sessions and far from its 52-week high of $153.13. 

On a valuation basis, Nvidia’s forward price-earnings ratio is 27.4x, and it trades at 21.3 times sales — far above industry norms. Bulls argue that these valuations are justified based on the company’s industry dominance and astronomical fundamentals, including its 55.85% profit margin and 112.33% return on equity. Skeptics point out there isn’t much margin for error at these elevated levels, though.

Nvidia Beats on Earnings

Nvidia surpassed fourth-quarter fiscal 2024 expectations with EPS of $0.89, comfortably above the consensus estimate of $0.74. Full-year revenue was $130.5 billion, while net income was $72.88 billion, driven by strong demand for its AI and data center products. 

Looking at the near term, analysts are estimating EPS of $0.87 for the current quarter, a 50% increase from the same quarter a year ago ($0.58). Full-year EPS projections for fiscal year 2026 and fiscal year 2027 are $4.16 and $5.15, respectively, suggesting further earnings growth ahead.

What Do Analysts Expect for Nvidia Stock?

Wall Street remains bullish on Nvidia. The stock has a “Strong Buy” consensus rating on coverage from 44 analysts. Of those, 38 rate it a “Strong Buy,” two a “Moderate Buy,” and four say “Hold.” The average analyst rating has increased from 4.74 to 4.77 over the past three months, indicating persistent confidence.

The consensus price target for NVDA stock is $177.19, which implies a 28% upside from the current level. The high estimate is as much as $220, indicating there is more room for price appreciation if momentum continues.

While analysts haven’t significantly altered their projections in recent weeks, the arrival of DeepSeek and other open-source AI competitors introduces a new element of risk. Investors should closely monitor both Nvidia’s results and the evolving competitive landscape.