We recently published a list of the top 10 trending AI stocks to watch in November. In this article, we’ll take a look at how NVIDIA Corporation (NASDAQ:NVDA) stands compared to other trending AI stocks to watch in November.
As AI stock valuations soar, novice investors continue to wonder if they’ve missed the AI party. However, investment experts believe that opportunities abound in the AI space due to the nature of this technological revolution.
In a conversation with The Wall Street Journal during the WSJ Tech Live Conference, venture capitalist Martin Casado, general partner at Andreessen Horowitz, explains why he thinks it’s not “too late” for AI right now. explained.
“When it comes to AI, it really feels like the marginal cost of language, reasoning, and creation will be zero. If so, this is a supercycle. If so, we have decades to go. There is no such thing as “too much.” In that sense, we are still in the very early stages. ”
The AI revolution is rapidly entering a phase where we are seeing real-world use cases as AI helps businesses significantly reduce costs and increase efficiency. AI-based tools that monitor real-time data in electronic medical records reduced unexpected deaths among hospitalized medical patients by 26%, according to a detailed report published by Benesh’s AI Committee.
Casado also talked about the usefulness of AI models in solving real-world problems.
“Everyone is focused on OpenAI, but when it comes to value creation and integration, if you look at all the private companies, the small and medium-sized enterprises that are building their own small models, they are leading the industry. Some of the fastest growing companies in history.”
Also read “Top 10 Healthcare Stocks to Buy” and “Top 10 Mid-Cap Healthcare Stocks to Buy Now” as rated by hedge funds.
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A close-up view of a colorful high-end graphics card connected to a gaming computer.
Number of hedge fund investors: 179
Ben Reitzes of Melius Research recently said on CNBC:
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“It’s like when Apple created the iPhone. If you gave up on Apple in the second or third year of the iPhone, you missed out on a lot. So this is just the beginning. And what people are really wondering about is their size. They already have a huge market cap, but they still have room to grow. And of course, Jensen has investments all over the East Coast. He’s been running around New York meeting with people at home. He has a lot of good things to say, so I think you should listen to him.”
Investors will be keeping an eye on NVDA when it releases its latest quarterly results next month.
NVIDIA’s decline after its second-quarter results was more or less expected following Blackwell’s delayed report 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.
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 approximately $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. .
In its Q3 2024 investor letter, Vltava Fund said of NVIDIA Corporation (NASDAQ:NVDA):
“Over the summer, we spent a lot of time researching the wave of AI-related investments. This spans a wide range of sectors, but our view can be summarized very briefly as follows: Yes, the beneficiaries of the first phase will primarily be companies in the semiconductor sector, with NVIDIA Corporation (NASDAQ:NVDA) probably the biggest beneficiary, as it builds out huge data centers. We know who NVIDIA’s customers are: companies like Meta, Alphabet, and Microsoft. What’s not entirely clear, however, is who NVIDIA’s customers are and will continue to be, and more importantly, who they will be from AI. The question is when and if we can create enough demand for AI services to make it profitable and justify the huge investments that all these companies have made. The further you get from the starting point that NVIDIA represents in its broader estimates, the less reliable those estimates become. Yes, there is ongoing investment in AI capabilities, and that investment continues to be huge. They are in great demand, not only in chip manufacturers and the semiconductor sector, but also in several other sectors. In fact, building an AI cluster will also require the construction of new semiconductor factories, new energy sources, and all related infrastructure over the next decade. Building an AI center could require a 20% increase in U.S. energy consumption, and the required investment would be orders of magnitude higher, perhaps double orders of magnitude. .”
Overall, NVDA ranks #5 on our list of AI trending stocks to watch in November. We see the potential in NVDA, but behind the scenes we believe AI stocks have great potential 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: 8 Best Widemot Stocks to Buy Now and 30 Most Important AI Stocks, According to BlackRock
Disclosure: None. This article was originally published on Insider Monkey.
