Bernstein analyst Stacy Rasgon says Nvidia’s (NASDAQ: NVDA) recent deal with the California-based artificial intelligence (AI) startup, Groq, removes the last remaining bear case from its stock.
Founded by Jonathan Ross – the architect behind Google’s first tensor processing unit (TPU) – the startup specialises in high-bandwidth, low-latency architectures.
The announcement arrives at a time when Nvidia shares have surged to record levels, driven mostly by relentless global demand for AI chips.
What is the last remaining bear case for Nvidia stock
In a recent CNBC interview, Stacy Rasgon said Nvidia’s spending some $20 billion to acquire Groq’s assets and talents eliminates the only argument sceptics had left: NVDA isn’t a winner in inference.
For years, critics have argued that Nvidia’s chips are optimised for training but less competitive in inference.
According to him, Groq’s innovations give the multinational a direct path to integrate cutting-edge inference architectures into its future products.
By absorbing Groq’s tech and personnel, Nvidia can demonstrate leadership across both domains. This makes the bear case “a lot harder to argue,” Rasgon concluded.
Groq is a low-risk deal for NVDA shares
While Groq marks the biggest deal Nvidia has announced since its inception, Rasgon believes it’s still small relative to the giant’s multi-trillion-dollar market cap.
In fact, the Bernstein analyst dubbed it a “bolt-on” acquisition, meaning it offers significant upside at a low financial risk.
On CNBC, he argued Nvidia’s scale positions it to absorb such transactions without disrupting its balance sheet or investor expectations.
“They can do a $20 billion deal on Christmas Eve with no press release, and nobody would bat an eye.”
For shareholders, the takeaway is clear: Groq deal strengthens NVDA’s overall positioning within the AI ecosystem – with minimal downside risk.
Nvidia is widening the gap with rivals
By bringing Groq’s expertise in inference into its ecosystem, Nvidia is not just neutralising a bear case – it is extending its lead over competitors.
Rivals like AMD and Intel have struggled to match Nvidia’s dominance in training workloads, and now face an even steeper challenge in inference.
Groq’s architectures promise faster, more efficient processing for real‑time AI applications, from autonomous vehicles to generative AI services.
Integrating these capabilities into Nvidia’s roadmap widens the performance gap, making it even more difficult for competitors to catch up.
The deal signals NVDA intends to own the full AI stack, reinforcing its position as the undisputed leader in the semiconductor industry.
How Wall Street recommends playing Nvidia shares
Despite a strong rally in NVDA stock this year, Wall Street expects it to rally further in 2026.
The consensus rating on Nvidia shares currently sits at “strong buy”, with the mean target of about $256 indicating potential upside of roughly 30% from here.
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