Nvidia Corporation, a $3 trillion company, remains a favorite among investors despite its high valuation.
The company’s focus on artificial intelligence (AI) has driven strong revenue growth and market dominance.
Now, Nvidia is expanding into new AI technologies, which experts believe could sustain its success.
New AI Opportunities
At the recent Consumer Electronics Show, Nvidia CEO Jensen Huang announced plans to lead in “physical AI.”
This technology allows robots and devices to interact with the physical world, opening doors in industries like robotics and autonomous vehicles.
Top investor Danil Sereda believes this shift will reduce Nvidia’s reliance on GPUs and create new industry-leading products. “This will impact many industries, from robotics to driverless cars,” Sereda said.
Valuation and Growth
Nvidia’s stock trades at a high price-to-earnings (P/E) ratio of 45x for FY2025. However, Sereda notes this could drop below 30x by FY2026, making the stock more attractive for long-term investors.
Sereda also highlights Nvidia’s efforts to diversify its business. This strategy aims to create smoother growth beyond 2029, making the stock appealing for medium- to long-term holding.
Wall Street’s Take
Wall Street analysts are optimistic about Nvidia. The stock has 36 Buy and 3 Hold ratings, with a 12-month average price target of $176.44. This implies a 32% upside potential.
Nvidia’s move into new AI markets could strengthen its leadership in technology. While the stock’s valuation is high, its long-term growth potential and innovative plans make it a strong choice for investors.
Disclaimer: Always perform your own analysis before making investment decisions.
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