Trump Could Repeal AI Chip Export Restrictions. How Should You Play Nvidia Stock Here?
Nvidia (NVDA) shares are inching up as of this writing following a report that President Donald Trump will soon rescind export restrictions that were slapped on AI chips by former U.S. President Joe Biden.
The “AI diffusion rule” introduced by the Biden administration was “overly complex” and will, therefore, be replaced with a “much simpler rule that ensures American AI dominance,” a federal spokesperson revealed in a recent email to Yahoo Finance.
The report bodes well for NVDA given it has already warned of a massive hit to earnings due to new restrictions on exporting its H20 chip to China. Including today’s price action, Nvidia stock is up more than 25% versus its low in early April.
Does That Pull Nvidia Stock Entirely Out of the Woods?
While positive on the surface, a potential repeal of the Biden-era rule may not be a definitive lifeline for Nvidia stock as Trump is reportedly considering replacing the AI diffusion rule with a global licensing regime with government-to-government agreements.
This could prove even “more strict than Biden’s [policy] as they would put AI chips at the center of tariff negotiations,” argued Citi analyst Atif Malik in his latest research note.
Plus, the White House could soon impose up to 25% tariffs on semiconductors, which may further hurt NVDA business in the back half of 2025.
Bernstein Has Not Lost Conviction on NVDA Shares
Despite aforementioned headwinds, Bernstein analysts remain uber bullish on NVDA shares.
On Thursday, the investment firm reiterated its “Outperform” rating on the AI stock, saying “the datacenter opportunity is enormous, and still early, with material upside still possible.”
Bernstein currently has a $185 price target on Nvidia stock that signals potential upside of more than 55% from current levels.
Note that the AI darling remains a favorite among individual investors as well. According to recent data from JPMorgan, retail traders parked as much as $1.1 billion into NVDA over the past week.
Wall Street Agrees With Bernstein on Nvidia
Investors should also note that Bernstein is certainly not the only firm that’s sticking to a positive view on Nvidia.
The consensus rating on NVDA shares remains at “Strong Buy” with the mean target of $166 indicating potential upside of more than 40% from here.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.