NVIDIA Corporation (NASDAQ: NVDA) could grow to twice the size of Apple in 2025 and become the most profitable company in history. This is due to Mr. Saxo’s wild prediction for the company. It says the following:
Since the launch of ChatGPT, NVIDIA stock (NVDA) has gained momentum, bringing generative AI into the spotlight and driving unprecedented demand for AI hardware. The stock has soared an astonishing 189% since the beginning of the year, reflecting the company’s important role in the AI industry and strong financial performance throughout the year.
The company’s graphics processing units (GPUs) were originally used for the video game market, but now they generate significant revenue from AI customers. Despite some regulatory challenges, the company has maintained its growth trajectory. Most analysts remain bullish on Nvidia’s prospects. Melius Research analyst Ben Reitz, for example, likens the company’s positioning to Apple’s and emphasizes enthusiasm for Blackwell chips. Similarly, Piper Sandler’s Harsh Kumar lists Nvidia as the top large-cap pick in the artificial intelligence accelerator market.
But history shows that analysts are not always right. According to TipRanks data, 34 analysts have issued 12-month forecasts for Nvidia stock as of the end of 2023, with an average price target of just over $661 per share, implying a 33% upside over the next 12 months. is suggested. At the time, NVDA achieved record revenue of over $18 billion. This was a 206% year-over-year increase and 34% quarter-over-quarter growth. However, the company’s valuation metrics had mixed signals, with a P/E ratio of 65, which was relatively modest given its growth trajectory. However, the company’s P/S ratio of 28x is far higher than competitors such as AMD and Intel, suggesting that the company’s stock was “priced for perfection.” These predictions turned out to be extremely pessimistic, as NVDA’s stock price nearly tripled in 2024.
Our Research Director shared his thoughts on NVDA’s earnings results here. He believes NVDA stock could reach $170 within three months. While we acknowledge NVDA’s potential as an investment, we believe some AI stocks are more likely to deliver higher returns and do so in a shorter time frame. If you’re looking for AI stocks with more promise than NVDA, but trading at less than 5x earnings, check out our report on the cheapest AI stocks.
Read next: BlackRock’s 8 Best Widemot Stocks to Buy Now and 30 Most Important AI Stocks.
Disclosure: None. This article was originally published on Insider Monkey.
