Nvidia: A Smart Investment Amid AI Boom
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy NVDA?
Source: Fool
- Surging Market Demand: Nvidia's GPUs are at the heart of the AI boom, with the top four hyperscale cloud providers expected to spend a combined $600 billion on AI in 2023, driving sustained demand for Nvidia's chips and solidifying its market leadership.
- Outstanding Financial Performance: In Q4 of fiscal 2026, Nvidia's revenue soared 73% year-over-year to $68.1 billion, with a 20% sequential increase, demonstrating strong growth momentum in the AI chip market and boosting investor confidence.
- Clear Competitive Advantage: Nvidia achieved $215.9 billion in revenue for fiscal 2026, a 65% increase from the previous year, while its main competitors, Broadcom and AMD, reported revenues of $63.9 billion and $34.6 billion respectively, highlighting Nvidia's significant lead in market share and growth rate.
- Long-Term Growth Potential: According to Grand View Research, the AI market is projected to expand at a compound annual growth rate of 30.6% over the next decade, positioning Nvidia as a key beneficiary of this long-term trend and making it a preferred investment choice for investors.
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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: 199.570
Low
200.00
Averages
264.97
High
352.00
Current: 199.570
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 Earnings Growth Expected to Accelerate Over Next Three Years
- Market Share Expansion: Nvidia's upcoming Vera Rubin processors are expected to reduce inference costs by 90%, significantly enhancing its competitiveness in the AI inference market, with projected data center sales reaching $1 trillion in 2026 and 2027, a substantial increase from the previous $500 billion forecast.
- Strong Profitability: Nvidia anticipates a 75% increase in earnings per share for the current fiscal year, reaching $8.34, far exceeding the tech sector's estimated 44% year-over-year growth, showcasing its robust profitability and market leadership in the AI sector.
- Partnership Growth: Nvidia has established partnerships with leading AI companies such as Anthropic, Meta, xAI, and OpenAI, providing a stable demand source as these companies see strong adoption of their AI inference applications, further solidifying Nvidia's market position.
- Long-Term Growth Potential: Despite Nvidia's current P/E ratio of 42.5, significantly higher than the Nasdaq-100's 33.4, its strong earnings growth potential justifies this valuation, with expectations of surpassing a $10 trillion market cap within the next three years, attracting more investor interest.
See More
NVIDIA Has Not Sold H200 Chips to Chinese Firms Amid Trade Concerns
- Sales Delay: NVIDIA has not sold its H200 AI chips to Chinese enterprises, as reported by Secretary Howard Lutnick, who attributed the delay to China's government banning acquisitions to favor domestic market investment, highlighting the tension in US-China trade relations.
- Policy Impact: The Trump administration approved shipments of H200 chips to China in January with conditions, raising concerns among US lawmakers about potential military applications, which has further complicated sales terms and slowed supply chains.
- Export Restrictions: Lutnick mentioned that the affiliates rule blocking exports to thousands of Chinese businesses is still under consideration, linked to broader trade negotiations, indicating that policy uncertainty may affect NVIDIA's market strategy.
- Investment Potential: While NVIDIA is recognized as one of the best data center hardware stocks, analysts suggest that certain AI stocks may offer greater upside potential and lower downside risk, reflecting a diverse outlook on the AI sector.
See More
Nvidia: A Smart Investment Amid AI Boom
- Surging Market Demand: Nvidia's GPUs are at the heart of the AI boom, with the top four hyperscale cloud providers expected to spend a combined $600 billion on AI in 2023, driving sustained demand for Nvidia's chips and solidifying its market leadership.
- Outstanding Financial Performance: In Q4 of fiscal 2026, Nvidia's revenue soared 73% year-over-year to $68.1 billion, with a 20% sequential increase, demonstrating strong growth momentum in the AI chip market and boosting investor confidence.
- Clear Competitive Advantage: Nvidia achieved $215.9 billion in revenue for fiscal 2026, a 65% increase from the previous year, while its main competitors, Broadcom and AMD, reported revenues of $63.9 billion and $34.6 billion respectively, highlighting Nvidia's significant lead in market share and growth rate.
- Long-Term Growth Potential: According to Grand View Research, the AI market is projected to expand at a compound annual growth rate of 30.6% over the next decade, positioning Nvidia as a key beneficiary of this long-term trend and making it a preferred investment choice for investors.
See More
Micron Technology Shares Surge 53% Amid AI Chip Demand
- Significant Stock Surge: Micron Technology's shares soared 53% in April, reflecting strong performance amid surging demand for AI chips, with a market cap reaching $611 billion, making it the 19th largest company globally.
- Remarkable Revenue Growth: In its March earnings report, Micron reported revenue of $24 billion, nearly a 200% year-over-year increase, indicating the company's success in passing on price increases to customers while maintaining a 68% operating margin.
- Supply-Demand Imbalance: The demand for high-bandwidth memory chips for AI infrastructure is vastly outstripping supply, granting Micron, one of the few memory chip manufacturers globally, immense pricing power, which has driven its stock price higher.
- Future Profit Expectations: Although Micron's current P/E ratio stands at 26, lower than many large tech firms, the ongoing supply shortage is expected to lead to even higher record profits by 2026, drawing investor interest in its long-term growth potential.
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Oklo Stock Down 15%: Is It Finally Time to Buy?
- Stock Volatility Analysis: Oklo experienced a remarkable 238% gain in 2025, yet its stock has fallen 15% this year, indicating investor concerns about its future performance, necessitating a careful assessment of risks and opportunities.
- Technological Collaboration Prospects: Oklo's partnership with Meta Platforms to develop a 1.2GW nuclear energy campus is still in its early stages, but successful implementation could significantly enhance its market position and technological credibility.
- Fuel Supply Challenges: The Aurora reactor design relies on high-assay low-enriched uranium (HALEU), which is currently in short supply in the U.S., and this bottleneck is unlikely to be resolved before 2028, potentially impacting project timelines.
- Market Competition Pressure: While Oklo is viewed as a potential future leader in nuclear energy, analysts note its absence from the “best stocks to buy” list, reflecting skepticism about its short-term profitability.
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Analysis of Upcoming U.S. Jobs Report Outlook
- Job Market Expectations: According to FactSet consensus estimates, the U.S. is expected to add only 50,000 jobs in April, significantly lower than March's 178,000, indicating signs of economic slowdown that could impact investor confidence.
- Unemployment Rate Stability: The unemployment rate is anticipated to remain steady at 4.3%, suggesting that despite the decrease in job additions, the labor market remains relatively stable, potentially alleviating fears of an economic downturn.
- GDP Growth Situation: The U.S. GDP grew at a seasonally adjusted annualized rate of 2% in the first quarter, higher than the fourth quarter's 0.5% but below the 2.2% estimate, reflecting economic sluggishness that may influence future monetary policy decisions.
- Market Volatility: Despite a strong performance in April, with the S&P 500 and Nasdaq hitting record highs, investors should remain cautious of the upcoming
See More
Nvidia's Earnings Growth Expected to Accelerate Over Next Three Years
- Market Share Expansion: Nvidia's upcoming Vera Rubin processors are expected to reduce inference costs by 90%, significantly enhancing its competitiveness in the AI inference market, with projected data center sales reaching $1 trillion in 2026 and 2027, a substantial increase from the previous $500 billion forecast.
- Strong Profitability: Nvidia anticipates a 75% increase in earnings per share for the current fiscal year, reaching $8.34, far exceeding the tech sector's estimated 44% year-over-year growth, showcasing its robust profitability and market leadership in the AI sector.
- Partnership Growth: Nvidia has established partnerships with leading AI companies such as Anthropic, Meta, xAI, and OpenAI, providing a stable demand source as these companies see strong adoption of their AI inference applications, further solidifying Nvidia's market position.
- Long-Term Growth Potential: Despite Nvidia's current P/E ratio of 42.5, significantly higher than the Nasdaq-100's 33.4, its strong earnings growth potential justifies this valuation, with expectations of surpassing a $10 trillion market cap within the next three years, attracting more investor interest.
See More
NVIDIA Has Not Sold H200 Chips to Chinese Firms Amid Trade Concerns
- Sales Delay: NVIDIA has not sold its H200 AI chips to Chinese enterprises, as reported by Secretary Howard Lutnick, who attributed the delay to China's government banning acquisitions to favor domestic market investment, highlighting the tension in US-China trade relations.
- Policy Impact: The Trump administration approved shipments of H200 chips to China in January with conditions, raising concerns among US lawmakers about potential military applications, which has further complicated sales terms and slowed supply chains.
- Export Restrictions: Lutnick mentioned that the affiliates rule blocking exports to thousands of Chinese businesses is still under consideration, linked to broader trade negotiations, indicating that policy uncertainty may affect NVIDIA's market strategy.
- Investment Potential: While NVIDIA is recognized as one of the best data center hardware stocks, analysts suggest that certain AI stocks may offer greater upside potential and lower downside risk, reflecting a diverse outlook on the AI sector.
See More
Nvidia: A Smart Investment Amid AI Boom
- Surging Market Demand: Nvidia's GPUs are at the heart of the AI boom, with the top four hyperscale cloud providers expected to spend a combined $600 billion on AI in 2023, driving sustained demand for Nvidia's chips and solidifying its market leadership.
- Outstanding Financial Performance: In Q4 of fiscal 2026, Nvidia's revenue soared 73% year-over-year to $68.1 billion, with a 20% sequential increase, demonstrating strong growth momentum in the AI chip market and boosting investor confidence.
- Clear Competitive Advantage: Nvidia achieved $215.9 billion in revenue for fiscal 2026, a 65% increase from the previous year, while its main competitors, Broadcom and AMD, reported revenues of $63.9 billion and $34.6 billion respectively, highlighting Nvidia's significant lead in market share and growth rate.
- Long-Term Growth Potential: According to Grand View Research, the AI market is projected to expand at a compound annual growth rate of 30.6% over the next decade, positioning Nvidia as a key beneficiary of this long-term trend and making it a preferred investment choice for investors.
See More
Micron Technology Shares Surge 53% Amid AI Chip Demand
- Significant Stock Surge: Micron Technology's shares soared 53% in April, reflecting strong performance amid surging demand for AI chips, with a market cap reaching $611 billion, making it the 19th largest company globally.
- Remarkable Revenue Growth: In its March earnings report, Micron reported revenue of $24 billion, nearly a 200% year-over-year increase, indicating the company's success in passing on price increases to customers while maintaining a 68% operating margin.
- Supply-Demand Imbalance: The demand for high-bandwidth memory chips for AI infrastructure is vastly outstripping supply, granting Micron, one of the few memory chip manufacturers globally, immense pricing power, which has driven its stock price higher.
- Future Profit Expectations: Although Micron's current P/E ratio stands at 26, lower than many large tech firms, the ongoing supply shortage is expected to lead to even higher record profits by 2026, drawing investor interest in its long-term growth potential.
See More
Oklo Stock Down 15%: Is It Finally Time to Buy?
- Stock Volatility Analysis: Oklo experienced a remarkable 238% gain in 2025, yet its stock has fallen 15% this year, indicating investor concerns about its future performance, necessitating a careful assessment of risks and opportunities.
- Technological Collaboration Prospects: Oklo's partnership with Meta Platforms to develop a 1.2GW nuclear energy campus is still in its early stages, but successful implementation could significantly enhance its market position and technological credibility.
- Fuel Supply Challenges: The Aurora reactor design relies on high-assay low-enriched uranium (HALEU), which is currently in short supply in the U.S., and this bottleneck is unlikely to be resolved before 2028, potentially impacting project timelines.
- Market Competition Pressure: While Oklo is viewed as a potential future leader in nuclear energy, analysts note its absence from the “best stocks to buy” list, reflecting skepticism about its short-term profitability.
See More
Analysis of Upcoming U.S. Jobs Report Outlook
- Job Market Expectations: According to FactSet consensus estimates, the U.S. is expected to add only 50,000 jobs in April, significantly lower than March's 178,000, indicating signs of economic slowdown that could impact investor confidence.
- Unemployment Rate Stability: The unemployment rate is anticipated to remain steady at 4.3%, suggesting that despite the decrease in job additions, the labor market remains relatively stable, potentially alleviating fears of an economic downturn.
- GDP Growth Situation: The U.S. GDP grew at a seasonally adjusted annualized rate of 2% in the first quarter, higher than the fourth quarter's 0.5% but below the 2.2% estimate, reflecting economic sluggishness that may influence future monetary policy decisions.
- Market Volatility: Despite a strong performance in April, with the S&P 500 and Nasdaq hitting record highs, investors should remain cautious of the upcoming
See More
