Nvidia: A Wealth Creator in the AI Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy NVDA?
Source: Fool
- Shareholder Wealth Growth: Nvidia has significantly increased shareholder wealth, with an initial investment of $10,000 now worth $2.21 million, representing a staggering return of over 22,000%, far exceeding the S&P 500's gain of 292%.
- Strong Revenue Growth: Nvidia's fiscal fourth-quarter revenue soared 73% year-over-year to $68.1 billion, primarily driven by robust demand in the data center segment, where customers continue to scramble for its advanced AI training and inference chips.
- Massive Market Potential: Big tech is expected to spend a whopping $700 billion on AI data center hardware this year, indicating a significant market opportunity for Nvidia, especially with its Vera Rubin platform now in full production.
- Gaming Business Challenges: Despite the launch of DLSS 5 technology aimed at enhancing gaming experiences, consumer and industry responses have been lukewarm, highlighting Nvidia's lack of diversification in the gaming market, which may expose it to risks from potential AI spending slowdowns and rising competition.
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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: 172.700
Low
200.00
Averages
264.97
High
352.00
Current: 172.700
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
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 10-Year Investment Return Exceeds 21,690%
- Staggering Investment Returns: As of March 20, Nvidia's stock has produced a total return of 21,690% over the past decade, meaning a $1,000 investment made ten years ago would now be worth nearly $218,000, marking it as one of the best-performing stocks of the last decade.
- Remarkable Profit Growth: Nvidia reported a net income of $614 million in fiscal 2016, which ballooned over 19,000% to $120 billion by fiscal 2026 (ending January 25), showcasing the company's robust growth driven by the AI boom.
- Market Dominance: Nvidia's graphics processing units (GPUs) play a crucial role in powering data centers that support AI training and inference, solidifying its leading position in the industry and attracting significant investor interest.
- Optimistic Future Outlook: With continued bullish sentiment towards AI across the economy, further capital investments are expected to flow into the sector, which will likely enhance Nvidia's revenue and profit, reinforcing its market leadership.
See More
Nvidia Secures Approval for H200 Chip Sales in China
- Market Access Breakthrough: On March 17, Nvidia secured Chinese approval to sell its second most powerful H200 chip, paving the way for the company to resume sales and indicating a potential easing of US-China tensions in the AI sector.
- Production Capacity Boost: CEO Jensen Huang announced that Nvidia is ramping up production of the H200 chips to meet strong demand from China, highlighting the company's strategic focus on this critical market amid global AI competition.
- Revenue Dependency: Prior to the ban, China accounted for nearly a quarter of Nvidia's total revenues, making this approval a significant milestone for the company's long-term prosperity and underscoring China's vital role in its business strategy.
- Technological Leadership: Nvidia designs and sells high-performance GPUs and AI software, serving as a primary infrastructure provider for modern AI, data centers, and gaming, with its chips playing crucial roles in generative AI, autonomous vehicles, and professional visualization, further solidifying its market leadership.
See More
Analysts Upgrade Nvidia and KNOT Ratings Amid AI Demand
- Nvidia Rating Upgrade: Analyst Oliver Rodzianko upgraded Nvidia's rating from Hold to Buy, asserting that AI demand represents a structural shift with a projected 35% upside potential, as FY26 data center revenue reached $193.7 billion, reflecting a 68% year-over-year growth, indicating robust market demand.
- KNOT Offshore Partners Upgrade: Henrik Alex raised KNOT's rating from Hold to Buy, viewing the stock sell-off following a failed acquisition as an ideal entry point for the only U.S.-listed shuttle tanker pure play, setting a price target of $15.00.
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Super Micro Computer Stock Downgraded Amid Controversy
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- Retail Sentiment Surge: Despite widespread analyst downgrades, retail trader sentiment around SMCI has surged, with discussions rising approximately 78% in the past 24 hours and a staggering 1,812.5% over the past week, indicating strong expectations for a potential rebound in the stock.
- Sales Growth Expectations: Louis Navellier, founder of Navellier & Associates, highlighted Super Micro's recent 123% sales growth and a forecasted 171% increase, providing a basis for stock recovery, even as the stock dropped about 33% on Friday.
- Compliance Issues Impact: While Super Micro is cooperating with the Department of Justice and Navellier does not expect charges, the market's reaction to allegations against executives for violating U.S. chip export rules has led to a generally bearish outlook from Wall Street analysts.
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ASML Stock Rises on AI Demand Outlook
- Stock Surge: ASML's stock jumped 5.1% to $1364.12 by 11:40 a.m. ET on Monday, reflecting market optimism about the artificial intelligence sector, even though analyst Stacy Rasgon did not mention ASML directly.
- Positive Industry Outlook: Bernstein analyst highlights that despite a sell-off in AI stocks this year, demand for AI remains strong, with projections for Broadcom and Nvidia's 2025 profits potentially reaching $20 and $12 per share, respectively, indicating a bullish trend for the semiconductor sector.
- Supply Chain Impact: As profits soar for Broadcom and Nvidia, third-party contractors like TSMC will have more capital to invest in ASML's machines, thereby driving ASML's sales growth further up the supply chain.
- Earnings Expectations: Although ASML's price-to-earnings ratio stands at 46.5, suggesting it is not cheap, analysts anticipate a 19% annual earnings growth over the next five years, and if AI chip demand continues, ASML's stock could rise rapidly, presenting a buying opportunity for investors.
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Oil Price Plunge Boosts Stock Market Gains
- Market Surge: The S&P 500 rose by 2.10%, the Dow Jones by 2.30%, and the Nasdaq 100 by 2.19%, indicating a strong market response to the sharp drop in oil prices, which is expected to enhance corporate profitability.
- Oil Price Drop: Crude oil prices plummeted over 10% after President Trump postponed strikes on Iranian energy infrastructure, which will lower fuel costs for airlines and cruise lines, thereby boosting their profit margins.
- Bond Yields Decline: The 10-year Treasury yield fell from an 8-month high of 4.44% to 4.34%, reflecting reduced market concerns about inflationary pressures, which supports further stock market gains.
- International Tensions: Productive talks between Trump and Iran may lead to an end to the Middle East conflict, with the International Energy Agency reporting severe damage to over 40 energy sites across nine countries, potentially causing long-term disruptions to global supply chains.
See More
Nvidia's 10-Year Investment Return Exceeds 21,690%
- Staggering Investment Returns: As of March 20, Nvidia's stock has produced a total return of 21,690% over the past decade, meaning a $1,000 investment made ten years ago would now be worth nearly $218,000, marking it as one of the best-performing stocks of the last decade.
- Remarkable Profit Growth: Nvidia reported a net income of $614 million in fiscal 2016, which ballooned over 19,000% to $120 billion by fiscal 2026 (ending January 25), showcasing the company's robust growth driven by the AI boom.
- Market Dominance: Nvidia's graphics processing units (GPUs) play a crucial role in powering data centers that support AI training and inference, solidifying its leading position in the industry and attracting significant investor interest.
- Optimistic Future Outlook: With continued bullish sentiment towards AI across the economy, further capital investments are expected to flow into the sector, which will likely enhance Nvidia's revenue and profit, reinforcing its market leadership.
See More
Nvidia Secures Approval for H200 Chip Sales in China
- Market Access Breakthrough: On March 17, Nvidia secured Chinese approval to sell its second most powerful H200 chip, paving the way for the company to resume sales and indicating a potential easing of US-China tensions in the AI sector.
- Production Capacity Boost: CEO Jensen Huang announced that Nvidia is ramping up production of the H200 chips to meet strong demand from China, highlighting the company's strategic focus on this critical market amid global AI competition.
- Revenue Dependency: Prior to the ban, China accounted for nearly a quarter of Nvidia's total revenues, making this approval a significant milestone for the company's long-term prosperity and underscoring China's vital role in its business strategy.
- Technological Leadership: Nvidia designs and sells high-performance GPUs and AI software, serving as a primary infrastructure provider for modern AI, data centers, and gaming, with its chips playing crucial roles in generative AI, autonomous vehicles, and professional visualization, further solidifying its market leadership.
See More
Analysts Upgrade Nvidia and KNOT Ratings Amid AI Demand
- Nvidia Rating Upgrade: Analyst Oliver Rodzianko upgraded Nvidia's rating from Hold to Buy, asserting that AI demand represents a structural shift with a projected 35% upside potential, as FY26 data center revenue reached $193.7 billion, reflecting a 68% year-over-year growth, indicating robust market demand.
- KNOT Offshore Partners Upgrade: Henrik Alex raised KNOT's rating from Hold to Buy, viewing the stock sell-off following a failed acquisition as an ideal entry point for the only U.S.-listed shuttle tanker pure play, setting a price target of $15.00.
- TeraWulf Downgrade: Juxtaposed Ideas downgraded TeraWulf from Buy to Hold, noting that despite its promising 522 MW contracted capacity, the rapid stock rally has inflated valuations to a forward EV/Sales ratio of 21.63x, compounded by elevated debt and interest expenses, increasing risk.
- Oklo Downgrade to Sell: JR Research downgraded Oklo to Sell, highlighting that nuclear energy stocks have lost appeal as investors shift from speculative growth to value, with Oklo's heavy cash burn and lack of near-term revenue posing excessive risk in the current market environment.
See More
Super Micro Computer Stock Downgraded Amid Controversy
- Analyst Downgrades: Northland downgraded Super Micro Computer (SMCI) from 'Outperform' to 'Market Perform' with a price target of $22, indicating only about a 2% upside from its current trading price of $21.52, reflecting market caution regarding the company's future performance.
- Retail Sentiment Surge: Despite widespread analyst downgrades, retail trader sentiment around SMCI has surged, with discussions rising approximately 78% in the past 24 hours and a staggering 1,812.5% over the past week, indicating strong expectations for a potential rebound in the stock.
- Sales Growth Expectations: Louis Navellier, founder of Navellier & Associates, highlighted Super Micro's recent 123% sales growth and a forecasted 171% increase, providing a basis for stock recovery, even as the stock dropped about 33% on Friday.
- Compliance Issues Impact: While Super Micro is cooperating with the Department of Justice and Navellier does not expect charges, the market's reaction to allegations against executives for violating U.S. chip export rules has led to a generally bearish outlook from Wall Street analysts.
See More
ASML Stock Rises on AI Demand Outlook
- Stock Surge: ASML's stock jumped 5.1% to $1364.12 by 11:40 a.m. ET on Monday, reflecting market optimism about the artificial intelligence sector, even though analyst Stacy Rasgon did not mention ASML directly.
- Positive Industry Outlook: Bernstein analyst highlights that despite a sell-off in AI stocks this year, demand for AI remains strong, with projections for Broadcom and Nvidia's 2025 profits potentially reaching $20 and $12 per share, respectively, indicating a bullish trend for the semiconductor sector.
- Supply Chain Impact: As profits soar for Broadcom and Nvidia, third-party contractors like TSMC will have more capital to invest in ASML's machines, thereby driving ASML's sales growth further up the supply chain.
- Earnings Expectations: Although ASML's price-to-earnings ratio stands at 46.5, suggesting it is not cheap, analysts anticipate a 19% annual earnings growth over the next five years, and if AI chip demand continues, ASML's stock could rise rapidly, presenting a buying opportunity for investors.
See More
Oil Price Plunge Boosts Stock Market Gains
- Market Surge: The S&P 500 rose by 2.10%, the Dow Jones by 2.30%, and the Nasdaq 100 by 2.19%, indicating a strong market response to the sharp drop in oil prices, which is expected to enhance corporate profitability.
- Oil Price Drop: Crude oil prices plummeted over 10% after President Trump postponed strikes on Iranian energy infrastructure, which will lower fuel costs for airlines and cruise lines, thereby boosting their profit margins.
- Bond Yields Decline: The 10-year Treasury yield fell from an 8-month high of 4.44% to 4.34%, reflecting reduced market concerns about inflationary pressures, which supports further stock market gains.
- International Tensions: Productive talks between Trump and Iran may lead to an end to the Middle East conflict, with the International Energy Agency reporting severe damage to over 40 energy sites across nine countries, potentially causing long-term disruptions to global supply chains.
See More
