Nvidia stock continues to soar as analysts raise targets to $250 on AI chip demand. Can the rally hold, or is NVDA getting ahead of itself?

Nebius stock has soared impressively this year, and its rise seems justified considering its outstanding growth and solid prospects. Goldman Sachs believes that the stock remains undervalued when its growth potential is taken into account.

One analyst boosted his price target on Nvidia’s stock to a level that would imply a $5.7 trillion market cap, with the chip maker seemingly cleared to sell its H20 chip in China again.

Nvidia said it has filed applications to resume selling H20 GPUs in China and has received assurances that licenses will be granted.

The stock is worth $4 trillion for a good reason. Nvidia's dominance in AI chips allows it to earn very high margins. Nvidia made $77 billion in net income on $148 billion of revenue over the last year, and its net income has increased 892% over the last three years.

Currently, Nvidia accounts for nearly 8 percent of the S&P 500. That’s the highest weighting for a single stock in 45 years, according to Todd Sohn, senior ETF strategist at Strategas Securities. For context, industrials account for 8.7 percent of the index, while healthcare stands at 9.1 percent.