Nvidia’s (NVDA) Teflon-like stock may be taking a few swipes as the year winds down, but a new chapter awaits the AI market darling — and with it more impressive quarters of growth, experts and investors believe.
“Nvidia is printing money like Apple did in the early days of the iPhone,” Gerber Kawasaki Wealth and Investment Management president Ross Gerber said on Yahoo Finance’s Catalysts (video above), later adding, “the opportunity for AI is somewhat limitless at this point.”
Gerber, who has been an investor in Nvidia for the past decade after it rose to popularity for its high-performance gaming chips, thinks the company is entering its “next leg” of growth.
The growth is to be fueled by rapid global buildouts of artificial intelligence infrastructure, powered in large part by Nvidia’s leading-edge chips.
“Nvidia is not a highly expensive stock, but it’s not a cheap stock,” Gerber said. “But the actual profits that they’re driving and their monopoly position in the chip business just puts the next five years looking really good for Nvidia.”
“I certainly wouldn’t get off it now,” he added. “So for investors, Nvidia needs to be a part of your portfolio just as much as Apple and Microsoft.”
The excitement around what lies ahead for Nvidia is captured in retail investor inflows.
Nvidia has attracted $30 billion in retail investor inflows so far this year, according to data from Vanda Research. It makes Nvidia the most popular stock among retail investors in 2024, ahead of the SPDR S&P 500 ETF (SPY), with $15.3 billion in inflows, and Tesla (TSLA), with $14.7 billion.
Some traders have opted to get off the Nvidia rocket ship this month, however.
Shares of the new Dow Jones Industrial Average component are up just 0.7% in the past month. The Dow is down 10% in the last month, while the S&P 500 has lost about 1.7%.
Nvidia shares are still higher by 181% year to date.
The stock is facing a soul-searching moment, according to Bank of America semiconductor analyst Vivek Arya. This is related to several factors, including execution issues while trying to push through leading innovation and concerns around China exposure ahead of potential tariffs from returning president Trump.
“Some of these [issues] are company-specific forces,” Arya said on Yahoo Finance’s Opening Bid podcast (listen below), “and some of these are market forces.”
The switch to Nvidia’s Blackwell AI chip — which won Yahoo Finance’s 2024 Product of the Year award — hasn’t been seamless, Arya explained, and this has unnerved the bulls.
“The last two quarters have not been clean because they are going through the growing pains from one generation of product to a new generation,” Arya said.
Blackwell, which the company rolled out in March at its annual GPU conference, was hailed as Nvidia’s most powerful and innovative offering. However, bringing the completed idea in the form of a product to the masses has proven itself to be more difficult.
“Since [March], what we have seen is execution issues keeping it out of the hands of customers,” he said.
Now Wall Street’s gaze will shift to success toward unleashing Blackwell into a market that is hungry for its offerings. Arya believes that Blackwell will rack up billions in sales in 2025.
The stock could also see a near-term catalyst as Nvidia founder and CEO Jensen Huang takes the stage as a keynote speaker at CES 2025 in early January.
Yahoo Finance data shows that sell-side analysts expect Nvidia to increase net sales by $65 billion year over year in 2025, with earnings per share more than doubling.
“They’re the only game in town,” Wedbush tech analyst Dan Ives said on Opening Bid. The [AI] foundation starts with Nvidia. That is not changing.”
Brian Sozzi is Yahoo Finance’s Executive Editor. Follow Sozzi on X @BrianSozzi and on LinkedIn. Tips on deals, mergers, activist situations, or anything else? Email brian.sozzi@yahoofinance.com.
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