We recently published a list of 10 AI trending stocks to watch for the rest of 2024. NVIDIA Corporation (NASDAQ:NVDA) ranks No. 5 on our list, so it’s worth a deeper look.
Chris Heisey, chief investment officer at Merrill & Bank of America Private Bank, said on CNBC’s latest show that there is “huge momentum” behind the market rally. The analyst said a “wedge” in the market needs to be analyzed to gauge how much momentum is behind the optimism.
“The biggest wedge that existed in the market last year and in 2022 was inflation. That’s starting to go away. The fact is that no one is talking about whether we’re going to see any inflation that we should worry about.”
Heisey said the Fed’s fiscal policy easing and China’s “joining” are two key tailwinds for the market.
In response to a question regarding the hard vs. soft landing debate, analysts believe that between these two outcomes there are many other scenarios to consider, so we should look beyond the two possibilities. He said that.
“We have a lot of ingredients for a soft landing. I’d rather say it’s a mid-cycle slowdown due to easing fiscal conditions, and earnings should actually be revised upwards rather than downwards.” added Heisey.
In this article, we have selected the top 10 trending AI stocks based on the latest news and analyst ratings. For each company, we mentioned the number of hedge fund investors. Why are we interested in stocks that hedge funds invest in? The reason is simple. Our research shows that by mimicking the top stock picks of the best hedge funds, you can outperform the market. Our quarterly newsletter strategy selects 14 small- and large-cap stocks each quarter and has returned 275% since May 2014, outperforming the benchmark by 150 percentage points (Learn more ).
A close-up view of a colorful high-end graphics card connected to a gaming computer.
Nvidia Corp (NASDAQ:NVDA)
Number of hedge fund investors: 179
Nvidia Corporation (NASDAQ:NVDA) stock is valued at Bain, which says the AI-related hardware and software market is expected to grow 40% to 55% annually, reaching $780 billion to $990 billion by 2027.・It recently rose following a new report from & Company.
Nvidia’s decline after its latest quarterly results was more or less expected following reports of Blackwell’s delays confirmed by management. However, the main cause of the delay was due to changes in the Blackwell GPU mask. Analysts say this does not affect the chip’s core functional logic or design. Although Blackwell’s plans have been delayed by several months, Nvidia’s core growth theme remains the same.
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Nvidia will see significant growth on the back of the data center boom amidst the AI wave.
At Nvidia’s GPU Technology Conference in March 2024, CEO Jensen Huang estimated annual spending on data center infrastructure at about $250 billion. Depending on how long this level of investment continues, the total could be between $1 trillion and $2 trillion over the next decade. In the same Q&A session, Bank of America’s Vivek Arya echoed this estimate, saying that the total addressable market is in the range of $1 trillion to $2 trillion, especially if countries invest in their own AI infrastructure. suggested that it would fit within. By the end of the decade, spending is likely to reach the high end of that range.
Of course, NVIDIA doesn’t monopolize the entire $2 trillion opportunity, as it faces competition from companies like AMD, Google, Amazon, and even Apple’s homegrown AI accelerator. Some analysts believe that NVIDIA’s data center market share from 2025 to 2029 will exceed $950 billion, less than half of the total market, but still enough to make it a leader in the field. .
Ithaka US Growth Strategy says this about NVIDIA Corporation (NASDAQ:NVDA) in its Q2 2024 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is a market leader in visual computing through the production of high-performance graphics processing units (GPUs).The company serves four major growth markets: gaming, professional visualization, data center, and automotive. NVIDIA’s products have the potential to lead and disrupt the most exciting areas of computing, including data center acceleration, artificial intelligence (AI), machine learning, and autonomous driving. There are two reasons for the stock’s rise in the quarter: One, the stock benefits from a lot of excitement surrounding further developments in generative AI and the possibility that this will require the purchase of large amounts of Nvidia products in the distant future. Second, NVIDIA also posted strong results in the quarter and exceeded market expectations for Q2 2025 to support today’s accelerated computing infrastructure. demonstrated an advantageous position in the construction of
Overall, NVIDIA Corporation (NASDAQ:NVDA) ranks No. 5 on Insider Monkey’s list of 10 AI Trending Stocks to Watch for the Rest of 2024. We see the potential in NVIDIA Corporation (NASDAQ:NVDA), but AI has great promise for the stock 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: Analyst sees new $25 billion ‘opportunity’ in NVIDIA and Jim Cramer recommends these stocks.
Disclosure: None. This article was originally published on Insider Monkey.
