Key Takeaways
- Identifying the next Nvidia stock requires you to dive deep into a stock's current and future operations
- Find stocks that are positioned to take advantage of high-growth industries such as health tech and quantum.
- Use AI to help screen out stocks that have similar financial growth to Nvidia's
Introduction
If you are like me, you may find yourself one or two steps behind everyone else in the market. With the recent surge in Nvidia's stock price, you may feel like the ship has already sailed. For once, it would be great to stay ahead of the market, hence, this guide will attempt to uncover the next Nvidia stock, so you don't miss another AI stock opportunity.
Why has Nvidia stock skyrocketed?
Unless you have been living under a rock, you should have a relative understanding of who Nvidia is and what it does. In lamens terms, the company produces GPUs designed to run complex computations for computers and IT services.
Recently, there has been an uptake in AI technologies, sparked predominantly by OpenAI's ChatGPT. Due to this rise in AI, Nvidia's GPUs have been placed at the forefront of processing AI algorithms, generating an increase in the company's revenue and driving its stock price higher due to speculation on future profitability.
Identifying the next Nvidia stock
You may think you need a crystal ball to identify potential Nvidia-like stocks, but it's far more simple. Although no one can accurately forecast a stock's price, we can turn to some key indicators that reveal whether a company will follow in Nvidia's footsteps.
Industry analysis
When searching for the next Nvidia stock, we must identify the industry and where it is going. For one, we are aware semiconductors will play an integral part in the development of new technologies such as Waymo's self-driving cars, OpenAI's GPT, SpaceX's rockets, and many more.
Understanding what industry the company is in and whether the industry has an expansive future, is an important factor when deciding which stock to invest in. Health tech, energy solutions, and quantum computing are all examples of industries with strong growth potential.
Future investments
Based on the above analysis, you need to dive deeper into what each stock's companies are investing in for the future. It wouldn't make much sense to invest in a mobile phone company that refuses to adapt, innovate, or develop new technologies (a great example of this would be Nokia).
You want to invest in a company that is considering its future operations and identifying paths to stay ahead of its competition. For example, Intel, known to have begun lagging behind its competition, has made strides to pivot its operations toward B2B sales rather than B2C, by investing in new manufacturing technology.
Current infrastructure
Infrastructure plays a huge role when identifying the next Nvidia stocks, as the company will need to support any substantiative supply chains, manufacturing hubs, distribution channels, and more. It would be unwise to assume new market entrants could compete with Nvidia-sized growth within a short period of time.
Fundamental analysis
Choosing the next Nvidia stock will also require companies to mimic similar growth trajectories. You can customize an AI stock screener to identify stocks that follow growth similar to Nvidia's. For example, Nvidia's key financials are:
- Quarterly Revenue YoY Growth > 10%
- Market Cap: Large & Mega
- Quarterly EPS YoY Growth > 10%
- Revenue 5-Year CAGR > 20%
- EPS 5-Year CAGR > 15%
Based on the above information, you can use your stock screener to screen out stocks that show similar fundamentals. This can give you a list of potential next Nvidia stocks.
Stocks that could be the next Nvidia
Based on the above steps, I have integrated them into identifying three potential next Nvidia stocks specializing in the semiconductor industries.
Advanced Micro Devices (AMD)
AMD has already established a foothold across the semiconductor industry hence, the reason I selected it to be a potential contender to Nvidia's stock. Similar to Nvidia, AMD is well-positioned to capitalize on the AI and cloud computing hype.
The company has a long history of strong relationships with Fortune 500 companies such as Microsoft, Sony, and others, meaning they have a list of constant buyers. In addition, AMD has achieved Quarterly Revenue YoY Growth > 10% and a Revenue 5-year CAGR > 20%, driven by strong demand in its core markets.
Based on the above analysis, you may want to consider adding AMD's stock to your investment portfolio.
Marvell Technology (MRVL)
Marvell Tech provides its products and services to a variety of industries including data centres, enterprise networking, and the automotive industry. Its recent acquisition of Inphi Corp has set it up to be a leader in growth areas such as 5G, high-speed data transfers, and cloud infrastructure.
From a fundamental standpoint, the company has shown signs of strong growth with Quarterly Revenue YoY > 10% and Revenue 5-year CAGR >20%. Marvell Technology also produces consistent YoY gross profit, it could be a potential next Nvidia stock.
Micron Technology (MU)
Last but certainly not least, Micron Technology. Another leader in the semiconductor industry, specializing in the production of memory and storage solutions.
The company has been investing heavily in advanced memory technologies, such as 3D NAND, and has been constantly expanding its operations across AI and data centre markets, key areas that need memory and storage.
Micron’s manufacturing capabilities are extensive, with production facilities across North America, Europe, and Asia, indicating a strong and resilient supply chain. Micron's YoY revenue from 2023 has increased by 61.9% and an increase in profit of 365% over the same period.
Frequently Asked Questions
What is the next Nvidia stock?
No one can provide this on a silver platter. As an investor, you must research and uncover each stock's potential growth trajectory. Industries such as health tech, quantum, and space exploration are high-growth areas.
Can Nvidia stock reach $200 in 2025?
Nvidia's market cap would reach $5 trillion, a 63% increase from its current stock price. Unless market speculation continues to drive its stock price, it is highly unlikely Nvidia can achieve enough revenue growth to support such a high market cap in 2025.
Will DeepSeek continue to hurt Nvidia's stock price?
Many investors think it will, hence its dip in price when DeepSeek become known. However, I believe not, as DeepSeek has now proven that startups and SMEs can easily develop advanced AI systems on a handful of Nvidia chips, opening the door to new market segments for Nvidia and potentially driving up its revenue.
Conclusion
Attempting to identify the next Nvidia stock can be a challenging task, but not an impossible one. By diving deep into a stock's technology, operations, industry, and financials, you can gain a slightly clearer picture of what stock has the best potential for maximising your portfolio's profits. For more stock insights, join the world's most powerful AI stock analyser.
