Three of 'your father's' stocks may be among the top AI derivative investments moving forward.
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 17 2025
0mins
Source: CNBC
Investment Insights: Tim Seymour, a chief investment officer, highlights classic companies like Cisco, Caterpillar, and Siemens as promising investments benefiting from the AI-driven data center buildout, suggesting they are undervalued compared to tech giants like Nvidia.
Cisco's Transformation: Cisco, once primarily a networking company, has successfully transitioned to a software-focused model with significant recurring revenue from security software, positioning it as a strong player in the current market.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 207.410
Low
200.00
Averages
264.97
High
352.00
Current: 207.410
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Nvidia's AI-Driven Growth Surges Significantly
- Stellar Financial Performance: Nvidia achieved a staggering 1,250% revenue increase and a 4,000% net income surge in 2023, driving a 1,320% rise in stock price, showcasing the company's robust performance and market dominance in AI.
- Data Center Growth: The company commands an 85% to 92% share of the data center GPU market, with global spending expected to reach $7 trillion by 2030, further solidifying Nvidia's leadership position in this booming sector.
- Optimistic Future Outlook: CEO Jensen Huang stated that Nvidia has visibility into $500 billion in sales over the next two years, with expectations to exceed $1 trillion in revenue by 2027, indicating strong growth potential ahead.
- Accelerated R&D Cycle: By shortening its GPU update cycle to 12-18 months compared to competitors' 3-5 years, Nvidia enhances its competitive edge in AI, with projections suggesting a market cap of $20 trillion by 2030.
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DGP Outperforms UGL in Five-Year Returns
- Return Comparison: DGP's five-year return of 242.93% significantly outpaces UGL's 200.29%, indicating DGP's structural advantage as an ETN, despite its direct credit risk tied to Deutsche Bank.
- Structural Differences: As an ETN issued by Deutsche Bank, DGP tracks an index calculation rather than holding physical futures, thus avoiding investor-level rolling costs, while UGL must roll futures contracts, which affects its performance due to contango or backwardation.
- Tax Implications: UGL holders receive a Schedule K-1 tax form, adding annual complexity, while DGP offers a 1099 form, simplifying tax handling and appealing to a broader investor base.
- Liquidity Considerations: UGL boasts larger asset size and tighter spreads, whereas DGP's smaller footprint can lead to wider bid-ask spreads during volatility, and the ETN carries closure or early redemption risks that UGL does not face.
See More
SpaceX IPO Boosts Intel Stock Recovery
- Stock Fluctuations: Intel's stock rose 4.3% on Monday, dropped on Tuesday, and rebounded on Wednesday, although it remains below the week's opening level, indicating market volatility in the semiconductor sector.
- Impact of SpaceX IPO: SpaceX's successful IPO, achieving a valuation of $2.5 trillion and raising over $80 billion in cash, is expected to lead to significant investments in semiconductors, particularly AI chips, boosting demand for Intel's products.
- AI Chip Demand: According to Lynx Equity, AI companies require substantial AI chips to train and deploy large language models, positioning Intel and Nvidia as key beneficiaries of SpaceX's spending strategy, enhancing their market presence.
- Strategic Partnership: Intel's collaboration with SpaceX to build the Terafab chip factory, which will also service Tesla, positions Intel to capitalize on the surging chip demand, potentially increasing its long-term growth prospects as a result of the SpaceX IPO phenomenon.
See More
Nvidia Invests in Nebius to Accelerate AI Development
- Massive Investment: Nvidia announced a $2 billion investment in Nebius in March 2023 to accelerate the construction of its data centers and AI factories, demonstrating strong confidence in AI infrastructure and expected to enhance Nebius's market competitiveness.
- Significant Revenue Growth: Nebius reported $399 million in revenue for Q1 2026, an almost 8-fold increase year-over-year, primarily driven by robust performance in its data center business, indicating a surge in demand within the AI and high-performance computing sectors.
- Robot Delivery Market Potential: Nebius's Avride segment achieved a 178% increase in deliveries in Q1, totaling 174,000 robots, and is poised to benefit from the rapid expansion of the delivery robot market, projected to grow from $686 million to $7.6 billion.
- Long-Term Growth Outlook: Nebius aims to achieve over 4 GW of contracted data center power capacity by the end of 2026, which is expected to significantly scale its operations, with analysts forecasting substantial revenue growth in the coming years, further solidifying its leadership in the AI sector.
See More
CoreWeave's Stock Volatility and Future Outlook
- Stock Volatility: CoreWeave's shares surged approximately 10% on June 16 to around $117, yet remain 37% below last June's peak of $187, indicating cautious optimism about its future growth amidst market fluctuations.
- Revenue Growth: For the first quarter ending March 31, CoreWeave reported a 112% year-over-year revenue increase to about $2.08 billion, a 32% rise from the previous quarter, while its backlog of contracted future revenue reached $99.4 billion, reflecting strong market demand and a diversified customer base.
- Capital Expenditure Pressure: CoreWeave anticipates capital expenditures between $31 billion and $35 billion for 2023, primarily funded through debt, leading to a net interest expense that more than doubled to $536 million and a widened net loss of $740 million, highlighting the high costs of its expansion.
- Customer Concentration Risk: Despite securing significant contracts with major clients like Meta and Anthropic, 62% of its 2024 revenue still relies on Microsoft, indicating high customer concentration that could impact its growth trajectory, necessitating investor vigilance regarding sustained market demand.
See More
Recap of CNBC Investing Club Monthly Meeting
- Portfolio Analysis: During the June Monthly Meeting, Jim Cramer and Jeff Marks provided an in-depth analysis of 35 portfolio stocks, highlighting their preference for Intel due to its significant upside potential in data center CPU growth, particularly in the context of competition with TSMC.
- Tech Giants Restructuring: Cramer noted a reordering of the 'Magnificent Seven,' with newcomers like SpaceX and the yet-to-go-public Anthropic and OpenAI emerging as formidable competitors, indicating intensified market competition, especially in the AI sector.
- Strengths of Alphabet and Apple: Alphabet is positioned advantageously in the AI era with its YouTube and Waymo businesses, while Apple leverages its ecosystem of over 2.5 billion iPhone users to strengthen its AI partnership with Alphabet, showcasing both companies' robust market positions.
- Market Dynamics and Investment Strategy: Despite challenges faced by Meta and Microsoft, Cramer advises maintaining investments in Amazon and Nvidia, believing that the latter's GPU demand will continue to grow, and that Amazon's cloud business remains highly profitable.
See More
Nvidia's AI-Driven Growth Surges Significantly
- Stellar Financial Performance: Nvidia achieved a staggering 1,250% revenue increase and a 4,000% net income surge in 2023, driving a 1,320% rise in stock price, showcasing the company's robust performance and market dominance in AI.
- Data Center Growth: The company commands an 85% to 92% share of the data center GPU market, with global spending expected to reach $7 trillion by 2030, further solidifying Nvidia's leadership position in this booming sector.
- Optimistic Future Outlook: CEO Jensen Huang stated that Nvidia has visibility into $500 billion in sales over the next two years, with expectations to exceed $1 trillion in revenue by 2027, indicating strong growth potential ahead.
- Accelerated R&D Cycle: By shortening its GPU update cycle to 12-18 months compared to competitors' 3-5 years, Nvidia enhances its competitive edge in AI, with projections suggesting a market cap of $20 trillion by 2030.
See More
DGP Outperforms UGL in Five-Year Returns
- Return Comparison: DGP's five-year return of 242.93% significantly outpaces UGL's 200.29%, indicating DGP's structural advantage as an ETN, despite its direct credit risk tied to Deutsche Bank.
- Structural Differences: As an ETN issued by Deutsche Bank, DGP tracks an index calculation rather than holding physical futures, thus avoiding investor-level rolling costs, while UGL must roll futures contracts, which affects its performance due to contango or backwardation.
- Tax Implications: UGL holders receive a Schedule K-1 tax form, adding annual complexity, while DGP offers a 1099 form, simplifying tax handling and appealing to a broader investor base.
- Liquidity Considerations: UGL boasts larger asset size and tighter spreads, whereas DGP's smaller footprint can lead to wider bid-ask spreads during volatility, and the ETN carries closure or early redemption risks that UGL does not face.
See More
SpaceX IPO Boosts Intel Stock Recovery
- Stock Fluctuations: Intel's stock rose 4.3% on Monday, dropped on Tuesday, and rebounded on Wednesday, although it remains below the week's opening level, indicating market volatility in the semiconductor sector.
- Impact of SpaceX IPO: SpaceX's successful IPO, achieving a valuation of $2.5 trillion and raising over $80 billion in cash, is expected to lead to significant investments in semiconductors, particularly AI chips, boosting demand for Intel's products.
- AI Chip Demand: According to Lynx Equity, AI companies require substantial AI chips to train and deploy large language models, positioning Intel and Nvidia as key beneficiaries of SpaceX's spending strategy, enhancing their market presence.
- Strategic Partnership: Intel's collaboration with SpaceX to build the Terafab chip factory, which will also service Tesla, positions Intel to capitalize on the surging chip demand, potentially increasing its long-term growth prospects as a result of the SpaceX IPO phenomenon.
See More
Nvidia Invests in Nebius to Accelerate AI Development
- Massive Investment: Nvidia announced a $2 billion investment in Nebius in March 2023 to accelerate the construction of its data centers and AI factories, demonstrating strong confidence in AI infrastructure and expected to enhance Nebius's market competitiveness.
- Significant Revenue Growth: Nebius reported $399 million in revenue for Q1 2026, an almost 8-fold increase year-over-year, primarily driven by robust performance in its data center business, indicating a surge in demand within the AI and high-performance computing sectors.
- Robot Delivery Market Potential: Nebius's Avride segment achieved a 178% increase in deliveries in Q1, totaling 174,000 robots, and is poised to benefit from the rapid expansion of the delivery robot market, projected to grow from $686 million to $7.6 billion.
- Long-Term Growth Outlook: Nebius aims to achieve over 4 GW of contracted data center power capacity by the end of 2026, which is expected to significantly scale its operations, with analysts forecasting substantial revenue growth in the coming years, further solidifying its leadership in the AI sector.
See More
CoreWeave's Stock Volatility and Future Outlook
- Stock Volatility: CoreWeave's shares surged approximately 10% on June 16 to around $117, yet remain 37% below last June's peak of $187, indicating cautious optimism about its future growth amidst market fluctuations.
- Revenue Growth: For the first quarter ending March 31, CoreWeave reported a 112% year-over-year revenue increase to about $2.08 billion, a 32% rise from the previous quarter, while its backlog of contracted future revenue reached $99.4 billion, reflecting strong market demand and a diversified customer base.
- Capital Expenditure Pressure: CoreWeave anticipates capital expenditures between $31 billion and $35 billion for 2023, primarily funded through debt, leading to a net interest expense that more than doubled to $536 million and a widened net loss of $740 million, highlighting the high costs of its expansion.
- Customer Concentration Risk: Despite securing significant contracts with major clients like Meta and Anthropic, 62% of its 2024 revenue still relies on Microsoft, indicating high customer concentration that could impact its growth trajectory, necessitating investor vigilance regarding sustained market demand.
See More
Recap of CNBC Investing Club Monthly Meeting
- Portfolio Analysis: During the June Monthly Meeting, Jim Cramer and Jeff Marks provided an in-depth analysis of 35 portfolio stocks, highlighting their preference for Intel due to its significant upside potential in data center CPU growth, particularly in the context of competition with TSMC.
- Tech Giants Restructuring: Cramer noted a reordering of the 'Magnificent Seven,' with newcomers like SpaceX and the yet-to-go-public Anthropic and OpenAI emerging as formidable competitors, indicating intensified market competition, especially in the AI sector.
- Strengths of Alphabet and Apple: Alphabet is positioned advantageously in the AI era with its YouTube and Waymo businesses, while Apple leverages its ecosystem of over 2.5 billion iPhone users to strengthen its AI partnership with Alphabet, showcasing both companies' robust market positions.
- Market Dynamics and Investment Strategy: Despite challenges faced by Meta and Microsoft, Cramer advises maintaining investments in Amazon and Nvidia, believing that the latter's GPU demand will continue to grow, and that Amazon's cloud business remains highly profitable.
See More
