BMO Capital has initiated coverage of Nvidia (NVDA) with an Outperform rating and a Street-bullish $340 price target, with analyst Harsh Kumar naming the chipmaker the "top pick" among a wide group of semiconductor and quantum computing stocks the firm began covering on Thursday. Nvidia shares were trading at $216.18 as of Thursday, down 0.31% on the day, leaving BMO's target roughly 57% above the stock's current price. Coverage initiations mark the first formal ratings and targets a firm publishes on a stock, and BMO's launch spanned AI accelerators, custom silicon, analog chips, and quantum computing names.

Kumar pointed to Nvidia's full-stack combination of hardware and software as the core reason for the top billing. The firm sees a "defensible end-to-end HW/SW moat" that it believes the market is currently underpricing.

The stock trades at 18x forward P/E, which BMO views as a discount given the firm's model projecting revenue growth of 84% in FY27 and 50% in FY28.

BMO also flagged Nvidia's next-generation Vera Rubin NVL72 system — the platform generation that follows Blackwell in Nvidia's stated one-year release rhythm — which is expected to ramp in the second half of the year, as a key upcoming catalyst.

Demand continues to run hot, according to the firm. BMO noted that much of Nvidia's production capacity is already sold out for the next 12 or more months.

Nvidia posted a gross profit margin of 74% and revenue growth of 71% over the last twelve months. The stock carries a P/E ratio of 33.2.

Other Analysts Stay Bullish Ahead of Earnings

The BMO note adds to a growing pile of positive calls on the stock. Oppenheimer holds an Outperform rating with a $265 price target, citing Blackwell Ultra and VR200 developments — the current and next generations of Nvidia's AI chip lineup.

Stifel has a Buy rating and a $282 target, expecting Nvidia to beat earnings estimates and raise guidance. TD Cowen also holds a Buy rating with a $275 price target. Outperform and Buy ratings both signal that an analyst expects a stock to outpace its benchmark index.

Nvidia is set to report its second-quarter earnings soon, a release that will serve as a key test of whether those bullish calls hold up.

BMO Also Bullish on Broadcom, AMD, Marvell

BMO spread its optimism across the semiconductor space. Broadcom received an Outperform rating and a $455 price target, with BMO calling it the number two AI supplier behind Nvidia, driven by custom ASIC — application-specific chips built for individual cloud customers as an alternative to merchant GPUs — and networking.

AMD received an Outperform rating and a $550 target. BMO noted that AMD's Helios rack system has three lead customers in OpenAI, Meta, and Anthropic. Helios is AMD's planned rack-scale AI system, part of a broader industry shift toward selling integrated rack-level computing rather than standalone chips.

Marvell picked up an Outperform rating with a $250 target, while Semtech was also rated Outperform with a $155 target. Like Broadcom, Marvell is a major player in custom AI silicon.

In the analog segment, BMO rated Analog Devices, Impinj, and Microchip Technology all Outperform, with price targets of $430, $220, and $95, respectively. The firm said analog names are emerging from a post-COVID correction, pointing to improving PMI — the purchasing managers' index, a widely tracked gauge of manufacturing activity — cleared channel inventory, and rising backlogs.

D-Wave also received an Outperform rating and a $35 price target in the quantum computing space, extending the initiations beyond classical semiconductors.

Credit Ratings and Valuation Screens

InvestingPro data currently flags Nvidia as undervalued based on its Fair Value analysis, placing the company on the platform's most undervalued stocks list.

Credit ratings influence a company's cost of borrowing. Moody's rates Nvidia Aa1 with a positive outlook, and S&P holds an AA issuer credit rating on the company, both near the top of their respective scales. Both ratings were affirmed following Nvidia's $105 billion commitment to an AI data center campus in Pike County, Ohio.