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AI chip leader Nvidia<\/a> will have an embarrassment of riches in the coming years, and shareholders will be rewarded, a tech analysts predicted.<\/p>\n Ben Reitzes, a managing director and head of technology research at Melius Research, told CNBC on Wednesday<\/a> that Jensen Huang\u2019s Nvidia has mastered a \u201cfull stack\u201d approach with its hardware and software, giving it a key advantage in AI.<\/p>\n \u201cWhat they did is they built a computing language and an ecosystem that allows you to monetize AI, and obviously they\u2019re killing it,\u201d he said. <\/p>\n Reitzes has a price target of $160 on Nvidia stock, implying a 30% gain from Friday\u2019s closing price. Despite an ongoing selloff<\/a> that began earlier this month, shares have soared 150% so far this year after more than tripling in 2023. Among the Magnificent 7 stocks that he covers, Nvidia has the most upside ahead, he added.<\/p>\n Another big advantage Nvidia has over rivals is its annual cadence of innovating new products, Reitzes said. That means developers and customers will know where Nvidia is headed and can a budget for upgrades accordingly. <\/p>\n \u201cAnd they\u2019re running 150 miles an hour while everyone else is running 100. It\u2019s going to be hard to catch these guys,\u201d he said.<\/p>\n Given Nvidia\u2019s edge in the booming AI space, Melius Research projects the company will generate $270 billion in cash over the next three years, potentially setting the stage for huge shareholder returns. <\/p>\n Management may not be eager to tout the possibility of stock buybacks as those are often associated with older companies, Reitzes said. But in his view, it\u2019s obvious.<\/p>\n \u201cNo one\u2019s talking about it, and when you do the model we do, it\u2019s a cash gusher,\u201d he said. \u201cAnd there\u2019s nothing they can do. This government\u2019s not going to let them buy anything big. They can\u2019t invest that much in R&D. It\u2019s just not possible. So we gotta get it as shareholders.\u201d <\/p>\n To be sure, Nvidia has been returning capital to shareholders. In August, it announced a $25 billion repurchase program<\/a>. And last month, Nvidia boosted\u00a0its quarterly cash dividend by 150% from $0.04 per share to $0.10, equivalent to $0.01 per share on a post-split basis.<\/p>\n Nvidia declined to comment about the possibility of more stock buybacks.<\/p>\n For his part, Reitzes was quick to point out that any future buybacks wouldn\u2019t imply that Nvidia has stopped growing. \u201cIt\u2019s not an insult to buy back stocks if you have nothing else to do.\u201d<\/p>\n Nvidia\u2019s recent financials show that its ability to generate cash is accelerating. In the fiscal year<\/a> that ended in January, Nvidia\u2019s net cash provided by operating activities soared to $28.1 billion from $5.6 billion in the prior year.<\/p>\n And in the first quarter<\/a> that ended in April, net cash provided by operating activities was $15.3 billion\u2014already more than half of last year\u2019s total.<\/p>\n Meanwhile,\u00a0Huang told investors this past week that Nvidia\u00a0will remain the gold standard<\/a> for AI training chips amid concerns that rivals could cut into his market share.<\/p>\n The rollout of Nvidia\u2019s\u00a0Blackwell<\/a>\u00a0system later this year will only cement that lead, he said at the company\u2019s annual shareholder meeting on Wednesday.\u00a0<\/p>\n \u201cThe Blackwell architecture platform will likely be the most successful product in our history and even in the entire computer history,\u201d Huang said.<\/p>\n<\/div>\n\nSubscribe to the Fortune Next to Lead newsletter to get weekly strategies on how to make it to the corner office. Sign up for free<\/a>.<\/div>\n