Nvidia’s stock hasn’t been this cheap for nearly a year. Here’s what we say is that history will happen:

nvidia’s (NVDA) 2.63%)) Stock is not that often cheap. Whenever it sold out in the last few years, it was an incredible purchase opportunity. Now, Nvidia is still well away from the highest ever high, thanks to the fear caused by Deepseek’s innovative artificial intelligence (AI) model. The general fear is that in order to train AI models to the extent that it harms Nvidia’s business, you don’t need that much computing power to train AI models.

There is some benefit to this idea, but I don’t think it’s accurate as the forecasts for spending from some of Nvidia’s biggest clients continue to increase. As a result, I think history has been repeated and now offers great buying opportunities for Nvidia stocks.

Nvidia’s revenues will increase dramatically again in 2025

Nvidia has dominated the past few years as it drives most of its AI innovation. Its Graphic Processing Unit (GPU) can process calculations in parallel, making it much more useful for intense workloads such as training AI models. Furthermore, when companies buy GPUs, they don’t buy just one or two. They buy thousands, connect to clusters, and further amplify their computing power. Nvidia’s GPU has become the top pick for anyone in the AI ​​field.

Nvidia reports a stellar revenue growth quarter after the quarter, driving its stock to new heights.

NVDA Revenue (TTM) data by YCHARTS

Nvidia’s revenue growth is slowing, but the 94% growth is not disappointing. As Nvidia becomes a bigger business, the greater the growth, the more difficult it becomes to grow, so that growth rate naturally slows down. Still, that hasn’t stopped Nvidia from posting jaw drop growth numbers. Wall Street analysts expect 72% growth in the third quarter of 2025 and 52% growth in 2026 to $160 billion.

However, these numbers were raised in question after Deepseek announced a more efficient way to train generated AI models. These increased efficiency is realistic and many companies are working to integrate them into their models, but they require more computing infrastructure to handle all these AI workloads. It won’t change the fact that there is. This has led to many of Nvidia’s biggest clients who say their capital expenditures will be much higher in 2025 than in the past few years.

Meta Platform (Meta) 1.11%)) He said he would spend between $60 billion and $65 billion on capital expenditures this year. alphabet (Goog -0.54%)) (googl -0.49%)) It’s even higher at $75 billion. Amazon (amzn -0.73%)) It is on the charts with approximately $100 billion in capital expenditures expected for 2025. It is clear that there will be unprecedented levels of spending in 2025.

Metacapital Expenditure (TTM) Data by YCHARTS

This is going well for Nvidia’s business as these companies are one of their biggest clients. Clearly, Nvidia’s business will be strong next year and probably far beyond that. Combined with the Nvidia stock on sale, I think the future looks bright for both the stock and the company.

Nvidia’s stock worked well for investors who bought at similar valuation levels

The last time Nvidia stock was this low was in August 2024, with the revenue (P/E) metric from subsequent prices. Since then, inventory has risen by about 25%, even with sales by DeepSeek.

NVDA PE ratio data by YCHARTS

You will need to go back further when Nvidia’s shares are trading under revenues of less than 30 times. It was May 2024, with stocks rising nearly 60% from that level.

These are incredible returns and investors will be happy with such stocks in their portfolio.

History is on Nvidia’s side, and stocks look historically cheap. Many of Nvidia’s biggest clients say AI spending continues to rise. As a result, Nvidia’s stock now looks like a strong purchase.