Nvidia Stock Faces Turbulence Amid AI Boom and Market Uncertainties

Nvidia Stock Climbs As AI, Tariff News Spark Buying Interest - NVIDIA (NASDAQ:NVDA)

Feel unsure about the market's next move? Copy trade alerts from Matt Maley -- a Wall Street veteran who consistently finds profits in volatile markets. Claim your 7-Day free trial now. NVIDIA Corp NVDA is bouncing back, rising 3.7% by late Monday morning, as investors react to reports of a more measured U.S. tariff approach and fresh AI developments out of China. Despite recently triggering a Death Cross -- a traditionally bearish technical signal -- Nvidia stock is seeing renewed buying pressure, signaling a potential turnaround. Read Also: Nvidia Could Be The First $4 Trillion Stock; Here's Why... Tariff Tensions Ease, AI Race Heats Up Tech stocks led the market rally Monday after reports suggested former President Donald Trump may scale back broad tariffs on key trading partners. Among the sectors benefiting? Chips. Tariffs on semiconductors could be delayed or limited, providing a tailwind for Nvidia and other tech giants. Meanwhile, news from China's Ant Group -- co-founded by Jack Ma -- added another boost to semiconductor stocks in general. Ant reportedly trained advanced artificial intelligence models using domestically produced chips alongside processors from Advanced Micro Devices Inc AMD. The development underscores China's AI ambitions and the ongoing demand for high-powered chips, even as U.S. export restrictions limit Nvidia's reach in the region. Technical Signals: Mixed, But Improving? Chart created using Benzinga Pro Despite Monday's gains, Nvidia stock remains down 11.77% year to date, with technical indicators still flashing caution: The recent surge pumped Nvidia stock above its eight-day ($118.49) and 20-day ($117.65) simple moving averages (SMAs) -- suggesting renewed buying interest in the stock amongst traders. Despite the short-term leverage, Nvidia stock continues to trade below its 50-day ($126.57) and 200-day ($127.79) SMAs -- historically bearish signs. The Moving Average Convergence Divergence (MACD) indicator at a negative 2.54 -- also leaning bearish. The Relative Strength Index (RSI) sits at 51, suggesting Nvidia stock is neither oversold nor overbought. However, with renewed buying pressure and easing trade war concerns, Nvidia bulls are watching for a potential reversal. What's Next For Nvidia Stock? CEO Jensen Huang recently highlighted growing AI demand at the company's GTC Conference, emphasizing that even lower-cost models require more computing power than previously expected. With tariff relief on the table and AI innovation accelerating, Nvidia's next move could hinge on whether these tailwinds can overcome lingering technical weakness. For now, Nvidia investors are enjoying some relief -- just how long it lasts remains to be seen. Read Next: Nvidia Chip Flows Under Scrutiny As Malaysia Moves To Tighten Regulations Amid US Export Controls On China Photo: Shutterstock NVDANVIDIA Corp$122.003.65%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum82.75Growth95.09Quality97.24Value7.15Price TrendShortMediumLongOverviewAMDAdvanced Micro Devices Inc$113.907.01%Market News and Data brought to you by Benzinga APIs

Why Buying Nvidia Stock on the Dip Is Probably Smart -- and Buying Palantir Stock Probably Isn't | The Motley Fool

Coming into 2025, these two artificial intelligence (AI) stocks were on a roll. Nvidia's shares soared 171% last year while Palantir skyrocketed a whopping 340%. The stories are much different now. Both stocks are down more than 20% from their peaks (with Palantir plunging nearly 30% below its previous high). Is buying these two once-hot AI stocks on the dip a smart move? While both Nvidia and Palantir have seen their share prices take a shellacking, their big dips have different dynamics. Let's first look at Nvidia. After starting the year with a nice gain, the overall trajectory for Nvidia stock has been downward ever since (albeit with up-and-down swings along the way). The biggest news for the company came on Feb. 26 with its fourth-quarter update. Nvidia again reported tremendous growth with Q4 revenue soaring 78% year over year and adjusted earnings per share jumping 71%. However, many investors were concerned that the chipmaker's growth continues to slow and its gross margins are sliding. Meanwhile, Palantir's share price began to slump more quickly at the beginning of 2025. The stock soon reversed course, though, and went on a huge run that eventually resulted in a 65% year-to-date gain. But Palantir's momentum hit a brick wall a few weeks into February. The company's Q4 results announced on Feb. 3 weren't the culprit. Instead, investors worried about Palantir CEO Alex Karp's planned sales of $1.2 billion of his shares and a report that steep U.S. defense budget cuts were coming. The U.S. government is Palantir's largest customer. Returning to our original question: Is buying these stocks on the dip a smart move? I think Nvidia probably is a smart pick, but Palantir probably isn't. For one thing, Nvidia's growth is much stronger than Palantir's. Even though Nvidia's revenue growth is slowing somewhat, the company still projects sales will jump 65% year over year in Q1. Palantir expects full-year 2025 revenue growth of 31%, down from 38% growth in 2024. Nvidia's valuation is much more attractive than Palantir's, too. Sure, Nvidia's shares trade at a relatively high 26.2 times forward earnings. However, factoring in growth makes the stock look much less overpriced. Nvidia's price-to-earnings-to-growth (PEG) ratio, which includes five-year growth projections, is 1.13, according to LSEG. By comparison, Palantir's forward earnings multiple is a sky-high 158.7. Its PEG ratio is 3.09. Looking ahead, I'd rather be sitting in Nvidia's position more than I would Palantir's. Nvidia should enjoy booming sales from its new Blackwell GPU chips this year. It has even more powerful chips on the way. Agentic AI, robotics, autonomous vehicles, and possibly artificial general intelligence (AGI) could drive increased demand for its technology. Meanwhile, Palantir's top customer (Uncle Sam) is slashing spending with uncertainty surrounding how much agencies will spend on software going forward. I wouldn't rule out the possibility that Palantir's close association with the U.S. government could negatively impact its ability to win sales outside of the U.S., either. Note that I used the word "probably" in my answer about the wisdom of buying Nvidia stock on the dip but not buying Palantir. Why did I use this wiggle word? I acknowledge that my assumptions could be wrong. Nvidia's growth could slow more than I anticipate if the demand for AI chips tapers off. Palantir could make more headway in landing corporate and foreign government customers than I think it will. While my take could be proven wrong, though, I stand by it. I'm not alone in being much more bullish about Nvidia than Palantir, by the way. Wall Street has much greater expectations for Nvidia, too.

Nvidia Is Down 23% From Its Peak. Here's How the Rest of 2025 Could Play Out for This Artificial Intelligence (AI) Powerhouse. | The Motley Fool

Nvidia (NVDA -0.75%) has been the biggest success story of the artificial intelligence (AI) era thus far with the stock jumping more than tenfold from the start of 2023, shortly after ChatGPT came out, to its recent peak. Nvidia's market capitalization, which now hovers around $3 trillion, topped out at close to $4 trillion a few months ago. No other company in the history of the stock market has created as much wealth as quickly. Not surprisingly, Nvidia is still closely followed by investors, some of whom want to know if the stock can keep climbing, and others who want some assurance that their windfall gains won't suddenly disappear in a stock market slump. Nvidia's shares have already given up some of those gains, sliding 23% (as of March 19) from its peak in January as a combination of weakening consumer and business sentiment, slowing revenue growth, and some doubts about long-term AI demand have weighed on the stock. However, because of that pullback, Nvidia is now the cheapest it's been since 2019, arguably setting up a buying opportunity. Is Nvidia a buy right now? Let's take a look at what the company could have in store for the rest of the year. Nvidia recently hosted its annual GTC conference -- all heavily focused on AI -- and if there was one takeaway from the event, it's that the company has no intention of resting on its laurels. At the conference, CEO Jensen Huang outlined the company's product roadmap including future chip platforms like Rubin and Feynman, and touted AI forecasts, including one that showed data center capital expenditure spending reaching $1 trillion by 2028. The company also announced new partnerships, including one with General Motors to build autonomous vehicles. Among its other announcements, the company said it would build an accelerated quantum computing research center, giving it a stake in an emerging technology that some think could be as influential as AI. Nvidia also unveiled new partnerships with cloud hyperscalers Oracle, Microsoft, and Alphabet, ensuring that it maintains close relationship with its top customers and that its chips and components continue to meet their needs. It also introduced a multi-year plan that showed investors it would continue to push the envelope in AI. For example, Huang told the GTC audience that Rubin, its next GPU generation that is set to be released in late 2026, would power a supercomputer that is 14 times more powerful than the current equivalent, and requires less power. Nvidia faces a number of company- and industry-specific risks, namely that it needs AI spending to continue to increase, but there are also macroeconomic factors that have weighed on the stock and are keeping some investors cautious. The semiconductor industry is cyclical, and Nvidia has gone through several economic cycles before with the stock falling sharply. That doesn't mean the AI boom is about to end, but investors should be mindful of that risk. Tariffs also present a risk to the company, though it has already been forced to adapt to restrictions on exports to China, meaning that the trade war isn't an entirely new challenge. Given the company's 78% revenue growth in the fourth quarter and its strong guidance for the first quarter, the macro uncertainty doesn't appear to be impacting Nvidia's business, though it may be weighing on the stock. A recession or a slowing economy could impact growth of the business. However, the big tech companies that make up its biggest customers are all well-capitalized and therefore have the resources to continue to invest in AI. They also believe that underspending on the new technology is a greater risk than overspending. It's impossible to perfectly predict a stock's performance, but 2025 is shaping up to be another strong year for Nvidia's business even if macro-level concerns are weighing on the broader stock market. The company is continuing to be aggressive with its business expansions, partnerships, and new product launches, and demand for the new Blackwell platform, which is now in full production, is outstripping supply. Expect Nvidia to unveil more partnerships and product advances as the year goes on. While investors may have one eye on potential headwinds facing the company, such as the impact of DeepSeek, the overall outlook for Nvidia still looks strong, and the stock is trading at an attractive valuation following the recent pullback.

Nvidia Stock Looks Cheap Right Now, but Here's 1 Reason It Could Actually Be Expensive | The Motley Fool

The artificial intelligence (AI) behemoth Nvidia (NVDA 3.16%) has gotten off to a rocky start this year, with shares down about 9% (as of March 24) so far in 2025. The emergence of the Chinese AI chatbot DeepSeek, concerns about economic growth, and President Donald Trump's proposed tariffs have led investors to reconsider the popular AI trade. But as most long-term investors know, sell-offs are often opportunities to buy shares of great companies at more attractive valuations, especially if the company's fundamentals are still intact. Many would argue that this is the case for Nvidia, with Wall Street near a consensus buy on the stock. However, while Nvidia stock may in fact be cheaper right now, there's one reason it actually could be expensive. A big part of the Nvidia story over the years and in the present is the company's incredible margins. Gross margin is calculated by taking revenue, subtracting the cost to make the goods sold, and then dividing this number by revenue. While gross margin doesn't account for all expenses at a company, it looks at the money retained after the costs to make a product. A high gross margin also indicates efficiency and pricing power because it suggests a company has the power to set a high cost relative to the cost of the good. That implies there is an inelastic demand. As you can see, Nvidia's gross margin has contracted in recent quarters. In the company's fiscal 2025 fourth quarter (ended Jan. 26, 2025), the gross margin fell to just over 73%. That's still an incredible gross margin and earnings still increased from the third quarter. But it also means that the increase in the cost to make Nvidia's chips and other AI infrastructure didn't translate into as much revenue growth. For instance, in the company's third quarter, the cost of revenue grew 20% from the prior quarter and revenue grew 17%. But in the fourth quarter, the cost of revenue rose 19%, while revenue only grew 12% quarter over quarter. This might lead investors to believe that pricing power is eroding and there is more competition than initially believed, especially considering that Nvidia's margin is so high. On Nvidia's fourth-quarter earnings call, CFO Colette Kress said that its gross margin should remain in the low 70s as the company's next-generation Blackwell chips ramp up, but there will be an opportunity to see gross margin rebound back into the mid-70s later in fiscal year 2026 (now underway). Wall Street analysts seem to be giving the company the benefit of the doubt. Analysts on average expect the gross margin to bottom in the current quarter at 71.1%, according to data provided by Visible Alpha. They then expect the gross margin to rebound to nearly 74.5% by the end of fiscal year 2026. Diluted earnings per share are also expected to grow by nearly 48% in fiscal 2026 on a year-over-year basis. Nvidia currently trades slightly under 26 times forward earnings, which is much more appealing than when the stock traded at about 50 times forward earnings or more not too long ago. However, if management turns out to be incorrect and Nvidia's margin continues to contract, then Nvidia could actually be over-earning right now and its price-to-earnings (P/E) ratio would significantly increase if its market capitalization holds. As already mentioned, analysts currently project the gross margin will rebound this year and this very well could happen. It's something investors should consider not just with Nvidia, but with any stock they are covering. The forward P/E ratio (which relies on estimates) is a great indicator of where a stock is situated but it doesn't always tell the full story. The actual earnings of a company are critically important and can significantly impact the P/E ratio. It's certainly going to be a big driver for Nvidia's stock price this year.

Nvidia Stock Just Did This for the First Time in 3 Years. Here's What History Says Will Happen Next | The Motley Fool

Nvidia (NVDA 3.16%) amazed investors over the past few years, climbing with what seemed like nonstop momentum to reach record levels. The stock even soared beyond $1,000 last year before the company launched its stock split, a move to lower the per-share price. All of this is thanks to Nvidia's position in one of today's most-watched markets: artificial intelligence (AI). Analysts expect this market to explode higher throughout the decade, and developments we've seen so far support this idea. Tech giants are investing billions of dollars in their AI programs -- and many already are starting to see the efforts bear fruit. For example, Amazon's cloud computing arm last year posted a $115 billion revenue run rate as customers opted for its AI products and services. All of this has helped Nvidia's earnings to climb. The share price followed until recently, as concerns about the general economy outweighed optimism about Nvidia's financial results and future prospects. In fact, just last week, Nvidia stock did something it hasn't done for nearly three years. Let's take a look at this move, and consider what history says will happen next. Whether you're new to investing or have been buying stocks for years, you may have heard of technical analysis. It involves looking at historical market data to predict what a stock may do next. It's often associated with shorter-term investing as it could guide you to buy or sell at a specific moment to potentially benefit. Well, in the world of technical analysis, Nvidia stock just made a big move. Its 50-day moving average (an average price trend over a given period of time) last week passed below its 200-day moving average, forming what's known as a "death cross." And a death cross suggests negative momentum is picking up and that it could become a lasting trend. Now let's consider how Nvidia stock performed following its last death cross -- back in April of 2022. The measure was an accurate predictor of what was to come, as Nvidia stock sank about 45% from that point through the rest of the year. Another such move happened in November 2018, and Nvidia stock went on to drop more than 40% in the following nine months. So, does this mean Nvidia absolutely is heading for a sustained period of losses and that you should stay away from the stock? Not necessarily. It's important to remember that though technical analysis may on many occasions successfully detect short-term trends, it doesn't take into account fundamentals -- such as a great earnings track record -- or positive news that the company may report at any moment. Day traders find these patterns useful as they buy and sell in a matter of hours or days, but long-term investors shouldn't let a technical trend affect their investing decisions -- for two key reasons. First, as mentioned, technical analysis doesn't consider the true value of a company as measured by its fundamentals. It basically indicates when you might buy or sell in the near term to post a gain. But, to potentially score an even bigger win, you're better off betting on a quality stock for a number of years so that you can benefit as the company grows and develops in its market. Second, sentiment about a given stock -- in this case, Nvidia -- may shift overnight. At any point, if a key external element that's weighing on Nvidia changes, the stock could take off. For example, if the Trump administration loosens up the latest tariffs on imports or reaches an agreement with trade partners, that news may lift Nvidia shares. So, for the long-term investor, it's best to buy a stock when the valuation looks reasonable rather than attempting to wait for the very lowest level. It's very difficult to time the market, and if you try, you may miss out on opportunities (and spend way too much time starting at your computer screen). It's important to note that Nvidia went on to roar higher after past death cross periods -- more than 85% in the 18 months following the 2022 death cross and about 140% in the two years following the 2018 event. All of this means it's best to set aside concerns about potential short-term patterns and focus on a company's prospects over the coming years. In this case, Nvidia offers us plenty of reasons to be enthusiastic about what's to come. The company is the AI chip leader, and its focus on innovation should keep this going. And Nvidia's not only generating standout revenue, but it's also doing this at a high level of profitability -- with gross margin of more than 70% each quarter. Considering these points, trading for 25 times forward earnings estimates down from 50 earlier this year, Nvidia stock looks very reasonably priced today. So, even if history suggests Nvidia's negative momentum could continue, savvy investors may use this as an opportunity to get in on the stock for a good price -- then hold on and potentially win over the long term.

1 Trillion Reasons Why Nvidia Stock Is a Screaming Buy Now | The Motley Fool

Nvidia (NVDA 3.16%) has been one of the most dominant stocks in the market in 2023 and 2024. However, 2025 hasn't been so kind to the computing giant, as its stock is down over 18% from its January highs. There are fears that the massive AI spending wave could be affected by an uncertain economic outlook or that Nvidia's largest clients may look elsewhere to fulfill their computing power demands. Yet none of those fears have surfaced yet, and Nvidia's CEO and founder Jensen Huang just gave an astonishing outlook into how he projects spending on AI computing. During Nvidia's GTC conference (its annual conference about its products), Huang stated that Nvidia's data center infrastructure revenue will hit $1 trillion by 2028. No company on earth has revenue that large, with Walmart currently holding the top spot at $673.8 billion in annual revenue. Furthermore, that's only data center revenue; it doesn't include any of Nvidia's other segments. However, if Nvidia's data center revenue reaches $1 trillion by 2028, that will dwarf any other segment's revenue total. That's a huge number, but it realistic? Over the past four quarters, Nvidia generated data center revenue of $115.3 billion. However, this segment is seeing remarkable growth, as Q4 data center revenue was up 93% from a year ago. So, if Nvidia continues at this 93% pace and keeps it up over the next four years (through 2028), will that be enough to hit $1 trillion? The answer? Yes. Should Nvidia continue at its 93% growth rate, it would actually produce $1.6 trillion in data center revenue by 2028. That's a complete overshoot of Huang's projections. Nvidia would only need to grow its revenue at a compound annual growth rate (CAGR) of 72% through 2028 to make the $1 trillion projection happen. So, to see how realistic this guidance is, investors need to monitor Nvidia's data center revenue growth during each quarterly earnings report. It needs to stay elevated above that threshold during the first few years for Nvidia to stay on target. If it doesn't, then it won't be surprising if Nvidia misses its $1 trillion goal. While a 72% CAGR seems incredibly optimistic, what can investors expect if Huang is right? If Nvidia were to reach $1 trillion in revenue and maintain its 56% profit margin, it would produce $560 billion in profits. That's a mind-boggling figure that no company is even close to right now, and it would provide jaw-dropping returns. Even if Nvidia traded at the market average price-to-earnings (P/E) ratio of 22.3 (that's what the S&P 500 trades at right now), that would give Nvidia a market cap of $12.5 trillion. Considering that Nvidia's market cap is currently at $2.9 trillion, that would indicate Nvidia's stock would rise roughly 330% over the next four years. Any investor would be happy with returns like that over a four-year period, which makes Nvidia an intriguing stock to buy now. But what if he's wrong and Nvidia falls short of expectations? Nvidia still looks like a good buy now. Nvidia's stock no longer trades at a huge premium. It's now priced at 26 times forward earnings, which is cheaper than many of its big tech peers. So, even if Nvidia still grows but falls short of its $1 trillion in revenue goal, then it should still be a successful investment, as it's not starting off with an unrealistic valuation.

Nvidia Thinks It Just Unleashed a Robot Revolution. Is It Time to Buy the Stock Hand Over Fist? | The Motley Fool

It's no secret that Nvidia (NVDA -0.66%) currently stands at the center of the artificial intelligence (AI) boom. The company's GPUs are the gold standard for powering AI models. It's also no secret that AI is critical to developing the next generation of robots. Unsurprisingly, therefore, Nvidia is an important player in robotics technology. And the company thinks it just unleashed a robot revolution. Is it time to buy Nvidia stock hand over fist? Last week, Nvidia announced several new technologies that it claimed would "supercharge humanoid robot development." Nvidia Isaac GR00T N1 was the centerpiece of the company's new offerings. The company introduced GR00T N1 as "the world's first open, fully customizable foundation model for generalized humanoid reasoning and skills." Nvidia revealed that this new foundation model uses an architecture inspired by how humans think. The System 1 version mirrors human reflexes, while the System 2 version makes deliberate and methodical decisions. The company also introduced simulation frameworks and blueprints for robotic development. The Nvidia Isaac GR00T Blueprint supports generating synthetic data. Newton is an open-source physics engine Nvidia is developing with Alphabet's Google DeepMind and Disney Research. Nvidia said that Newton "lets robots learn how to handle complex tasks with greater precision." "The age of generalist robotics is here," according to Nvidia CEO Jensen Huang. He stated, "With Nvidia Isaac GR00T N1 and new data-generation and robot-learning frameworks, robotics developers everywhere will open the next frontier in the age of AI." These new robotic development offerings are just the beginning. Nvidia said that GR00T N1, which is already available, is the first of multiple models the company will launch for robotics developers. Disney Research is among the first organizations deploying Newton. The unit is using Nvidia's engine to develop next-generation entertainment robots including the BDX droids inspired by Disney's Star Wars franchise. Kyle Laughlin, senior vice president of Walt Disney Imagineering research and development, said, "The BDX droids are just the beginning. We're committed to bringing more characters to life in ways the world hasn't seen before, and this collaboration with Disney Research, Nvidia, and Google DeepMind is a key part of that vision." Laughlin added, "This collaboration will allow us to create a new generation of robotic characters that are more expressive and engaging than ever before -- and connect with our guests in ways that only Disney can." Entertainment isn't the only goal for the next generation of robots powered by Nvidia's technology, though. The company said that its models will accelerate the development of robots to help industries that face significant labor shortages. Are Nvidia's new robotics products a good reason to buy the stock hand over fist right now? Not on their own. For one thing, new products don't always live up to the hype. Also, it remains to be seen how much Nvidia GR00T N1 and the simulation frameworks and blueprints will move the needle for a company that generated $130.5 billion last year. However, the potential to pave the way for a new age of robots could be one of several reasons to buy Nvidia stock. The market opportunity is huge, with global labor shortages estimated at more than 50 million people. Another more compelling near-term reason to consider investing in Nvidia is the likely growth of its new Blackwell GPU architecture. Huang said in the company's fourth-quarter earnings call, "The demand for Blackwell is extraordinary." Despite the beginning of a rebound, Nvidia's share price remains nearly 20% below its peak set earlier this year. Buying Nvidia on such pullbacks has always paid off handsomely in the past. History just might repeat itself.

Stock Market Uncertainty Has Rattled Investors. Is Artificial Intelligence (AI) Darling Nvidia Still a Buy? | The Motley Fool

The Nasdaq has dropped markedly as investors sour on technology stocks. If there is one thing that investors really don't like, it's uncertainty. Right now, a host of factors ranging from new tariffs, geopolitical unrest in the Middle East and Europe, economic indicators such as jobless claims -- and even some murmurings of stagflation -- have made investors uneasy. After soaring to record highs over the last two years, the Nasdaq Composite has turned southward -- and mega-cap tech stocks have sold off in epic fashion. In just the last month, artificial intelligence (AI) darling Nvidia (NVDA -0.66%) has lost roughly $600 billion in market value following a 16% drop in its share price. Could more drops be in store for Nvidia, or is now a lucrative opportunity to take advantage of the market slump and buy the dip? The direction in which a share price moves and the underlying business fundamentals for a specific business are not always correlated. Although shares of Nvidia have been sliding for several weeks now, the financial profile below shows a pretty compelling picture -- one that underscores the demand for Nvidia's products and services are in demand, and the company is able to fulfill this demand at a highly profitable rate. One good way to assess what Nvidia's future could look like is to pay attention to the moves of its customers. Some of Nvidia's largest clients include cloud hyperscalers Microsoft, Alphabet, and Amazon, as well as another "Magnificent Seven" member, Meta Platforms. Each of these companies recently reported earnings for the full calendar year 2024. During their respective earnings calls, investors learned that these AI behemoths are gearing up to spend north of $320 billion on AI infrastructure at the high end of their guidance this year. Considering that competition in the data center GPU market is still limited, I think it's highly likely that Nvidia will benefit greatly from rising capital expenditures (capex) among its largest existing customers. Over the past year, investors have been peppered with talking points about Nvidia's next-generation GPU architecture, Blackwell. Well, Blackwell is finally here, and its initial results did not disappoint. During the fourth quarter, revenue from Blackwell came in at $11 billion -- which was above management's internal estimates, according to Nvidia CFO Colette Kress. While Blackwell is expected to be Nvidia's latest growth engine in the near term, the company is already working on a line of new products that should not be overlooked. Just a few days ago, Nvidia CEO Jensen Huang took the stage at the company's high-profile GTC conference. In addition to Blackwell, Huang showcased a lineup of successor architectures dubbed Blackwell Ultra, Rubin, and Rubin Ultra. Over the next couple of years, Nvidia is expected to continue releasing refined versions of its already market-leading GPUs. In my eyes, the spending forecasts from big tech that I referenced above indicate that AI remains a top priority, and I think that supports Nvidia's efforts to double down on research and development (R&D) and continue innovating at light speed. The chart below illustrates Nvidia's price-to-earnings (P/E) multiple over the last several years. At a P/E of roughly 40, Nvidia stock is actually trading close to its cheapest valuation on a P/E basis in five years. The AI revolution has not just served as a bellwether for Nvidia -- it represented a transformative shift in the company's operation from primarily a business focused on gaming to one that is now fueling myriad applications across the AI realm for the world's largest companies. While a cratering stock price may give the appearance of a bearish narrative, the trends analyzed in this piece suggest that Nvidia's future prospects look incredibly bright. Shares appear to be trading for a bargain compared to historical valuation levels, making the ongoing sell-off stock a terrific opportunity to double down and buy the dip in Nvidia stock.

Hold Nvidia? Here Are 2 Unstoppable AI Stocks You Can Also Buy. | The Motley Fool

Many artificial intelligence (AI) stocks have sold off recently, presenting compelling buying opportunities for patient investors. But folks with a sizable amount of their portfolio in names like Nvidia (NVDA -0.66%) may be looking for other ideas. Here's why Vertiv Holdings (VRT -2.37%) and Nebius Group (NBIS -7.04%) stand out as two exciting AI stocks -- and why Nvidia is also an incredible buying opportunity hiding in plain sight. Daniel Foelber (Nvidia): Despite blowout earnings and impressive new product innovations, Nvidia stock is down over 12% year to date at the time of this writing. The sell-off has pushed Nvidia's forward price-to-earnings (P/E) ratio down to just 26. Nvidia is now less expensive than many of its big tech peers, like Apple and Microsoft, which both fetch forward P/Es over 29. Even Walmart has a forward P/E of 32.5. Investors may be wondering why a company at the cutting edge of AI is such a bargain. The answer comes down to expectations. When investors are optimistic about a company's near-term growth prospects, they may be willing to pay a premium price for the stock. But when investors are pessimistic, they may prefer to value companies on where they are today, rather than where they are going. Over the last year, Nvidia's diluted earnings per share (EPS) is up 72%. Over the last three years, revenue is up over 340%, and earnings are up over 680%. Growth at that level won't continue, since Nvidia is now a much larger business. But this change is already reflected in analyst estimates. Fiscal 2027 EPS estimates are $5.76, which would be just 27.2% higher than the fiscal 2026 forecast. If Nvidia even comes close to those targets, we'll look back at today's stock price as dirt cheap in hindsight. But what if there's a global economic slowdown, Nvidia's customers slash their spending, and Nvidia's growth stalls or even turns negative? In that scenario, Nvidia will likely fall short of analyst estimates. Nvidia's low valuation prices in some of these risks, making the stock a better balance of risk and potential reward. And even if the stock pulls back during an industry slowdown, Nvidia the company should have no issues investing in its long-term growth plans. Nvidia has done a masterful job sustaining high margins and brushing off competition. It has an impeccable balance sheet, with more cash, cash equivalents, and marketable securities than long-term debt. The company can easily afford to pour money into research and development and continue innovating even during a downturn. That way, it can take even more market share when the cycle reverses. Add it all up, and Nvidia remains a foundational AI stock that investors can build a portfolio around. Lee Samaha (Vertiv): Shares in Nvidia partner Vertiv are down 22% year to date at the time of this writing due to a combination of a market sell-off in AI-related stocks and some disappointing near-term news from the company on orders from Europe. The company's connection to AI comes from its critical digital infrastructure technologies used in data centers. As demand for data-intensive AI applications rises, so will demand for AI-capable data centers. This is where Vertiv comes in. As noted, Vertiv did see some orders pushed out in Europe in the fourth quarter, but according to management, this is due to regulatory decisions related to new energy-efficiency regulations in effect in 2025 in Europe. However, it's likely to prove temporary, as end demand remains robust. While orders were flat year over year in the fourth quarter, they still rose 30% on a full-year basis. Management's guidance for 2025 reflects underlying growth: Revenue is forecast to grow 16% organically, and adjusted operating profit to increase by a colossal 25%. The market has sold off the sector on valuation concerns, but Vertiv now looks like a commendable value. It trades at 17.7 times Wall Street estimates for free cash flow (FCF) in 2026 -- that looks cheap for a stock with double-digit revenue growth prospects -- and definitely cheap for an AI-related stock. Scott Levine (Nebius Group): It's certainly not a name as easily recognizable as Nvidia, but Nebius is an AI business that can grow in popularity as the industry continues to flourish. Developing the infrastructure to support AI usage, Nebius provides investors with an indirect way to gain Nvidia exposure. It may be flying under the radar right now, but opportunities like these are where investors can benefit considerably if they have the resolve to stick with a high-risk, high-reward stock like Nebius. While Nebius has businesses developing autonomous driving and providing training data for generative AI, the company's AI infrastructure business represents the lion's share of the company's revenue -- more than 50% in fourth quarter 2024. The company is working to expand its AI infrastructure presence considerably. In the coming weeks, Nebius plans to launch its first Nvidia GPU cluster (using Hopper GPUs) in the United States; moreover, the company announced a goal to deploy more than 22,000 of Nvidia's Blackwell GPUs in data centers located in the U.S. and Finland in 2025. With demand for AI infrastructure growing in 2024, Nebius benefited from strong revenue growth last year. The company logged sales of $117.5 million. And while the company came up short of guidance, reporting an annualized run rate (ARR) of $90 million in December 2024, management seemed optimistic about growth in 2025. In the Q4 2024 earnings announcement, Arkady Volozh, founder and CEO of Nebius, stated that with "the anticipated impact of additional data center capacity and Blackwell GPUs coming on-stream later this year, I am pleased to confirm that our projected December 2025 ARR of $750 million to $1 billion is well within reach." Although the future seems bright, the company is still incurring losses, so there's a fair degree of risk here. For those willing to make a speculative investment, Nebius stock could be a long-term winning pick.

My Top 3 Bargain AI Stocks to Buy after the Stock Market Drop | The Motley Fool

The stock market downturn has created a rare opportunity to purchase several high-quality stocks at discounted valuation levels. The U.S. equity market began 2025 on a positive note, with the S&P 500 index increasing nearly 2.8% in January 2025. Market sentiment was largely optimistic, fueled by strong earnings from artificial intelligence (AI)-powered companies and optimism about a resilient economy. However, things have worsened, as growing geopolitical tensions, rising economic uncertainty, and the increasing probability of trade wars are affecting investor confidence. The Nasdaq Composite spent much of March in correction territory, 10% off its highs. But this challenging period of market sell-offs also offers some of the best long-term buying opportunities, particularly for stocks of high-quality companies with sustainable competitive advantages and strong financials, as they trade at discounted prices. Here's my list of three top-notch AI-powered stocks that have become bargain buys. Shares of Nvidia (NVDA -4.83%) have plummeted more than 20% from their recent high of $153 on Jan. 7, triggered mainly by worries about AI overspending and trade wars. Despite this slump, the rapid pace of AI infrastructure buildout is the primary growth catalyst for Nvidia, a semiconductor giant accounting for almost 90% of the AI GPU market. With major technology companies gearing up to spend over $300 billion on AI technologies and data center buildouts in 2025, Nvidia's AI GPUs and AI-optimized software solutions continue to be in high demand. Demand for the recently launched Blackwell architecture systems is already surpassing supply. Designed mainly for inference workloads (deploying and running pre-trained large language models), including reasoning (a special inference use case), Blackwell is well-suited for advanced models that utilize large amounts of computing power and perform complicated and multistep tasks. By focusing on the recurring inference workloads (compared to training workloads), Nvidia is now targeting a much larger addressable market. Furthermore, Nvidia's tightly integrated software ecosystem has a significant competitive advantage since it has helped create a sticky customer base by dramatically increasing clients' switching costs. Nvidia CEO Jensen Huang also announced plans to launch Rubin GPU, the successor to Blackwell GPUs, in the second half of 2027 in a speech at the recent GTC conference focused on AI development. Despite the many pros, Nvidia is trading at a forward price-to-earnings ratio of 27.1, far lower than its five-year average of 72. Considering Nvidia's enviable position in the rapidly expanding AI market and valuation correction, it seems an unmissable buying opportunity. Shares of Meta Platforms (META -2.37%) have also fallen significantly, around 19% from its 52-week high of $740.91 on Feb. 14. Yet, the unparalleled strength of its core family of apps (including Facebook, Instagram, Messenger, Threads, and WhatsApp) and robust AI initiatives position it for a solid recovery in the coming months. With over 3.3 billion daily active users using at least one of its social media applications in December 2024, Meta enjoys access to vast amounts of real-time data about customer interests, preferences, behavior, and spending patterns. This data is then analyzed using advanced AI technologies to optimize content recommendation algorithms, which helps boost user engagement further. This has translated into robust growth for Meta's advertising business, which raked in revenue of $46.8 billion in the fourth quarter of 2024, up 21% year over year. The company benefits from increased advertiser demand and ad pricing on its platforms -- mainly due to its robust ad targeting capabilities. Meta is also investing heavily in AI initiatives. In fiscal 2025, the company plans to spend around $60 billion to $65 billion on AI-related data center buildouts and other initiatives. The company is a frontrunner in the agentic AI space with its widely used Meta AI assistant. The company is also making strides in the open-source large language model development space. Meta also boasts a strong balance sheet, with $77.8 billion in cash and $49.8 billion in debt. Yet, its valuation seems quite reasonable, with a forward P/E ratio of 23.9 -- lower than those of technology giants Nvidia, Microsoft, and Amazon, which enjoy similar competitive advantages in their respective industries. Hence, Meta seems a compelling buy for astute investors in 2025. Finally, Oracle (ORCL -1.85%) stock has also seen a lot of volatility, with shares trading 23% lower from their 52-week high of $198 this past Dec. 9. The sharp drop has provided an attractive entry point for investors, considering Oracle's remarkable growth trajectory in the cloud infrastructure business and rapid progress in AI initiatives. Oracle's remaining performance obligations (RPO, a measure of future revenue from existing contracts) totaled $130 billion at the end of the third quarter of fiscal 2025 (ended Dec. 31, 2024), a 63% increase year over year. Since cloud RPO grew 90% year over year and accounted for nearly 80% of the overall RPO, this metric strongly indicates demand for the company's cloud services. Furthermore, with 31% of the RPO expected to be recognized in the next 12 months, Oracle benefits from significant revenue visibility. Oracle's cloud infrastructure (OCI) business clocked an annualized revenue of $10.6 billion. Oracle also focuses on expanding its live data center count and power capacity to convert RPO into actual revenue. With the current demand for cloud services outstripping supply, OCI's revenue growth pace can further accelerate with increased data center capacity. The company is also making rapid progress in AI training and inferencing. Oracle's AI-related GPU consumption revenue was almost 3.5 times higher at the end of the third quarter than those earned in the prior year. Furthermore, Oracle invests heavily in building AI GPU clusters alone or in partnership with other companies. Oracle has also developed an AI Data Platform, to enable clients to use leading large language models from different sources to analyze their data stored in Oracle databases. Oracle is also a part of Project Stargate, an AI infrastructure investment initiative worth $500 billion, backed by the U.S. government. While Stargate has not yet contributed to Oracle's RPO growth, it can be a significant growth catalyst in the coming months. Yet, the stock trades at a forward P/E of 21.5, lower than its historical five-year average multiple of 32.8. Against this backdrop, any major positive news could push up the company's share prices in 2025.

3 Must-See Updates From Nvidia's AI Event | The Motley Fool

The Nvidia (NVDA -3.99%) GPU Technology Conference (GTC) has become a big event for the artificial intelligence developer community in recent years, and when CEO Jensen Huang gave his keynote speech at this year's event last week, he had some noteworthy thoughts to share about where AI is going and news about Nvidia's place in its future. If you're a Nvidia shareholder or are considering becoming one, here are three important updates you need to know about. Nvidia only recently rolled out its newest and most powerful graphics processing units (GPU), built on its latest Blackwell architecture, and demand has been intense. Nearly every developer and platform is looking for ways to leverage AI, and Nvidia has the most effective products to support those efforts. In its fiscal 2025's fourth quarter, which ended Jan. 26, revenue swelled by 78% year over year. Huang noted that Nvidia already had already booked billions of dollars in sales of Blackwell in its first quarter on the market. Tech giants with the budgets to build massive AI data centers want the best, and none of them wants to fall behind their peers. But Nvidia is already developing its next iteration of powerful chips: the Rubin architecture. These will be 14 times more powerful than Blackwell, and as AI's needs evolve and expand, it's a no-brainer bet that the companies developing and supporting the software will want the most powerful chips they can buy. Rubin is expected to launch late next year. Agentic AI is one of the next waves in the artificial intelligence space. These specialized tools will be able to act as "agents" on a user's behalf, autonomously taking care of such tasks as booking flights or writing emails after being prompted with simple requests. Because that will mean that such systems will need to manage far more steps, Huang said he thinks that agentic AI is going to need 100 times more power than current AI tools need. He thinks that those who believe that the advent of tools like DeepSeek -- which was apparently much cheaper to develop than previous large language models -- are going to undermine Nvidia's sales are getting it wrong, because the sheer power requirements of agentic AI will mean a greater need for chips like Nvidia's. While some peers have similar offerings on the market, Nvidia dominates in terms of production and sales in cutting-edge GPUs and AI accelerators, and it's constantly improving its chips to retain that dominance. Before Nvidia became a household name, it was a successful company and top stock in large part because of its strength in the video game segment. It has vast experience in creating worlds for its gaming products, and it can synthesize this with its reasoning capabilities to act in what's called "physical AI," or robots that can "think" and take action. Huang said "Everyone, pay attention. This could very well be the largest industry of all." It announced two new partnerships that will focus on this -- one with General Motors for its electric vehicles, and another with Walt Disney and Alphabet for robotics development. Nvidia stock is down 12% this year and is 21% off of its high. Despite the company's incredible financial performance last year and the tech sector's insatiable demand for its products, the stock market was spooked by the DeepSeek launch, and it remains wary about what's in store for Nvidia. Right now, Nvidia looks untouchable, but it wouldn't be the first time in history that an industry giant was caught by surprise by a smaller, more agile competitor with better technology. Huang is clearly not concerned that this could happen. He sees the DeepSeek model as a win for the AI industry overall and envisions cheaper AI models further fueling demand for Nvidia's products. If you already own Nvidia stock, I wouldn't worry too much, but I would suggest not letting that position become too large a piece of your portfolio. If you've benefited from Nvidia's meteoric rise over the past few years, you might want to consider selling some shares to rebalance your portfolio, remain well-diversified, and minimize your risk. However, if you don't own Nvidia stock yet, it's looking attractive right now, trading at only 21 times forward 1-year earnings. At this valuation, you might want to open a position.

Why Nvidia Stock Is Tumbling Today | The Motley Fool

Nvidia (NVDA -5.95%) shares are plunging today as investors worry that a major market for the artificial intelligence (AI) leader may be getting choked off. Nvidia has been caught in the trade battle between the U.S. and China before. But a move by the Chinese government today more directly targets Nvidia's AI chips than it had in the past. That news drove Nvidia shares more than 5% lower this morning. As of 11:37 a.m. ET, Nvidia stock was still down by 4.7%. Global trade pressure is part of the reason shares have dropped about 8% year to date. Concerns about Nvidia's business came from both sides today. The U.S. has announced a new trade blacklist of Chinese companies citing national security concerns. The list of more than a dozen Chinese tech companies includes major Nvidia customers. The U.S. government will now need to approve sales to companies on the list. At the same time, Chinese regulators have reportedly been pressuring its largest technology companies from purchasing Nvidia's H20 semiconductor chips citing the need for energy efficiency improvements. The H20 was specifically designed to qualify for sale in China after the U.S. imposed sanctions that disqualified its most powerful chips. The situation adds uncertainty for investors in a meaningful market. China was Nvidia's fourth-largest market, contributing $17.1 billion in revenue in fiscal 2025. That was 13% of its total sales. Nvidia CEO Jensen Huang has proven his leadership abilities in navigating trade issues before. As far back as 2022, Nvidia transitioned some operations out of China due to export controls. While data center revenue in China grew last year, the company says as a percentage of its total, it remains well below levels achieved prior to the onset of export controls in late 2023. Yet the company has thrived. Investors should feel confident it can navigate the current environment as well. Today's drop looks to be another opportunity to buy shares of the AI leader.

Why Nvidia Stock Is Sinking Today | The Motley Fool

Shares of Nvidia (NVDA -5.77%) are sliding on Wednesday. The AI chip leader's stock lost 4.3% as of 11:20 a.m. ET and was down as much as 5.2% earlier in the day. The drop comes as the S&P 500 and Nasdaq Composite indexes have lost 0.3% and 1.1%, respectively. The AI chip giant is facing fresh challenges in China -- an important market -- as regulatory pressures mount. Chinese regulators are reportedly discouraging the country's tech companies from purchasing Nvidia's H20 chip, claiming the processors breach energy efficiency regulations. The H20 is designed specifically for the Chinese market. Nvidia may prepare modifications to meet the new standards, but any alterations could affect performance, making them less competitive. The U.S. is reportedly adding dozens of Chinese companies to a trade blacklist over national security concerns. The expansion of export controls is an escalation of ongoing trade tensions and is likely to be met with a Chinese response in kind. These dual pressures from both Chinese and American regulators create a difficult operating environment for Nvidia in what has historically been a significant market for the company. The developing situation highlights Nvidia's vulnerability to geopolitical tensions, which have intensified under the current administration. Nvidia also faces mounting competition from rival chipmakers. But Nvidia remains the undisputed leader in the space, and with the ongoing blockbuster launch of its Blackwell chips, its new networking hardware, and more than $300 billion in AI-centered capex planned from its core customer base, Nvidia is in a good position to maintain its dominance. With a forward price-to-earnings ratio (P/E) of just under 27, it is competitively priced.

Stock Market Sell-Off: 2 AI Stocks to Buy Now and Hold for 20 Years | The Motley Fool

The recent dip in the major market indices has included some significant declines in the shares of leading artificial intelligence (AI) companies. Some of these tech stocks had monster runs over the last few years and might have been due for a pullback. Broader market fluctuations have a way of affecting individual stocks (for good and for bad) even if they represent great companies. While pullbacks are never fun for current shareholders, investors who are looking to buy now to fund retirements that are well in the future were just given a great opportunity to put some money to work. There are several elite AI stocks out there now trading lower valuations. Here are two AI stocks caught up in the broader market volatility worth buying today because they could be rewarding over the long term. Nvidia (NVDA -5.59%) is a no-brainer investment. It has been on the cutting edge of graphics processing unit (GPU) technology for a long time, and today, it controls a high percentage of the GPU market for data centers, where those chips provide the parallel processing muscle needed to train and power AI. With demand for its AI accelerators looking likely to remain strong for years, Nvidia should continue to grow and deliver great returns for investors. Because of AI, spending on data centers is accelerating for the first time in many years. Historically, about $250 billion has been spent annually on data center infrastructure. That could increase to $1 trillion annually by 2029, according to a forecast by Dell'Oro Group. But Nvidia CEO Jensen Huang believes these estimates underestimate the long-term opportunity, given the emergence of a new type of single-purpose data center built to support AI -- what Nvidia calls "AI factories." Every company that has a factory will also have an AI factory, according to Huang, and that assertion makes sense when you think about it. Companies across retail, transportation, and energy are using AI, and the technology will become more deeply rooted in how companies operate. "There's no question in my mind that out of $120 trillion global industries that a very large part of that [...] will be AI factories," Huang said during a recent conference call with analysts. Competition may heat up at some point from Advanced Micro Devices or other chip companies that want a piece of Nvidia's AI action -- which has propelled its profit margin to a remarkable 56%. But Nvidia's strengths in innovation and the large base of 5.9 million developers who use its CUDA software tools to get the most out of its GPUs should protect its lead. With the stock trading at 27 times this year's earnings estimate, Nvidia's long-term growth potential seems underestimated. It doubled its revenue last year, and analysts currently forecast that it will grow its earnings at an average annualized rate of 33% in the coming years. Buying shares of Broadcom (AVGO -4.64%) would complement an investment in Nvidia. Broadcom designs custom AI accelerators for its clients, and it's seeing robust demand for them. These specialized chips serve specific needs in data centers, such as moving data faster in GPU-powered servers. Revenue from Broadcom's AI solutions grew 77% year over year in its fiscal 2025 first quarter, which ended Feb. 2. With data center operators (hyperscalers) continuing to invest heavily in infrastructure, Broadcom should continue to see strong growth. It estimates the serviceable addressable market from three prominent hyperscalers alone will be between $60 billion to $90 billion in fiscal 2027, which is significant compared to its trailing-12-month revenue of $54 billion. Importantly, Broadcom has a long history of investing in opportunities that lead to great returns for shareholders. The stock has returned 1,300% over the last 10 years, so it's encouraging to see management announce plans to increase spending on research and development to keep its AI accelerators at the leading edge. The negative for Broadcom right now is its diversification across markets. It also provides chips for mobile devices, networking, and industrial markets, and this exposure across the semiconductor landscape means the company's revenue can be cyclical. Its non-AI semiconductor sales were down 9% sequentially last quarter due to seasonal weakness in the wireless market. Despite these near-term risks, the stock should continue to trade at a premium valuation based on Broadcom's history of excellent returns and opportunities in the data center space. Analysts expect its earnings to grow at an annualized rate of 22% in the coming years. The increasing computerization of the economy will benefit Broadcom investors over the next 20 years.

Nasdaq Post-Correction: My Top 3 AI Stocks to Buy Before They Soar | The Motley Fool

The Nasdaq, an index that roared higher over the past two years, spent most of March doing just the opposite. The benchmark slid into correction territory earlier in the month, meaning it fell more than 10% since its most recent high back in December. The reason for this shift? Investors worried that President Donald Trump's plan to impose a series of tariffs on imports could hurt growth at home. Growth-oriented stocks are particularly sensitive to the economic backdrop, so when uncertainty arises, they're often the first to decline. But, in recent days, the picture has brightened. Trump's latest comments suggest a certain flexibility regarding the implementation of tariffs, so investors have grown hopeful that impact on companies and the economy may be limited. This optimism spurred gains in the Nasdaq, lifting it out of the correction zone earlier this week, though the index has shifted back periodically. The Nasdaq has recovered some recent losses, but many of its stocks still are trading at bargain -- or at least reasonable -- prices. And this includes players in the promising and high-growth area of artificial intelligence (AI). Let's check out three of my favorite AI stocks to buy before they soar. Palantir Technologies (PLTR -4.33%) momentum seemed unstoppable until recent times. The AI software company posted the biggest gain in the S&P 500 last year, advancing 340%, and climbed to a record high in February. Investors have been excited about the company's double-digit revenue growth in its two businesses: government and commercial. Palantir sells these customers AI-driven platforms that help them aggregate and make better use of their data. The results often can be extremely impressive, with improvements in efficiency, cost control, and more. I particularly like how Palantir has been able to consistently balance growth with profitability, and proof of this is the steady growth in its Rule of 40 score. A result of 40% or higher shows a company is doing a good job on the growth/profit balance. Palantir, with a recent score of 81%, clearly is hitting it out of the park. Today, Palantir's forward price/earnings-to-growth (PEG) ratio, a valuation metric that considers growth, is 0.8. A reading under 1 suggests a stock may be undervalued. After the stock's 24% drop from its peak, now is a great time to hop on board. What I love about Amazon (AMZN -2.19%) is the fact that the company is using AI to improve its own business and selling AI products and services through its cloud-computing unit to generate revenue growth. So this e-commerce and cloud powerhouse is benefiting from AI across its operations. All of this has been bearing fruit, helping to lower Amazon's cost to serve in e-commerce and adding billions of dollars in revenue to its cloud earnings. I expect this to continue considering Amazon Web Services' (AWS') dominance in the cloud market -- it's the No. 1 player globally -- and the enormous growth forecasts for the AI market. On top of this, we're in the early stages of the AI story as companies today build out platforms. We haven't yet reached the stage when applying AI to daily life is a regular thing for all companies. All of this means AI should drive AWS growth for years to come, and since AWS is Amazon's main profit driver, this is a big deal. Today, Amazon shares trade for 32 times forward earnings estimates, down from 45 times just a few months ago -- a bargain for this AI stock that is ripe to head higher on any positive AI news. Meta Platforms (META -2.42%) is mainly known for its family of apps that probably populate your phone -- from Facebook and Messenger to WhatsApp and Instagram. More than 3.3 billion people use at least one of these on a daily basis. Today, this social media dominance is helping Meta show its strengths in AI. The company launched Meta AI in 2023, and it's now the most used AI assistant worldwide. How does Meta aim to win in AI? By introducing it across its platforms and fine-tuning AI assistants, for example, to serve the needs of users. This could prompt folks to spend more time on Meta's apps, thus driving advertisers to spend more and more of their dollars there to reach them. To accomplish this and other AI goals, Meta is investing big -- as much as $65 billion this year alone -- with the goals of constructing a massive data center and increasing its number of AI chips. The company also has designed its own large language model (LLM) and has made it open source -- a move that could position Meta for leadership in the AI industry. Today, Meta stock trades for 24 times forward earnings estimates, down from a peak of 29 times a few weeks ago, a fantastic buying opportunity as this potential AI winner could surge at any moment.

Nvidia Remains a Buy on AI Growth Prospects Despite Technical Red Flags | Investing.com UK

I recently returned from NVIDIA's GTC AI Conference in San Jose, California. This year's event was completely sold out, with an estimated 20,000 investors, engineers and business leaders in attendance. CEO Jensen Huang likes to call the annual get-together the "Super Bowl of AI," and after seeing his keynote, I understand why. Despite NVIDIA Corporation (NASDAQ:NVDA)'s stock flashing a bearish "death cross" -- its 50-day moving average slipped below the 200-day moving average for the first time since January 2023 -- the energy at the conference was electrifying. Every major industry was represented, from health care to defense, signaling that artificial intelligence (AI) is expanding at a white-knuckle clip.During his approximately two-hour presentation (and he didn't use notes!), Huang described a future where AI agents will transform entire industries, making businesses more efficient, aerospace and defense more advanced and markets more intelligent. In other words, if you thought ChatGPT was impressive, you haven't seen anything yet. Huang spoke extensively about "agentic AI," or AI that doesn't just retrieve data but perceives, reasons and acts on your behalf. In his example, AI agents "can go to a website, interpret words and videos, maybe even play a video, learn from it, understand it -- and then use that new knowledge to complete its task." To understand this better, imagine you work on Wall Street. An AI agent could scan earnings reports, build models and execute trades faster than a human could. In health care, AI agents will be able to diagnose diseases, assist in surgeries and manage hospital logistics -- all with limited human supervision. Perhaps the biggest impact will be in aerospace and defense. Huang made a bold prediction: "Everything that moves will be autonomous." This suggests a future with AI-powered drones, cybersecurity defense systems, battlefield robots and much more. The U.S. military is already testing AI systems that can independently identify threats and make tactical, split-second decisions in real-time. As I shared with you last month, the global AI market in aerospace and defense is projected to surge from approximately $28 billion today to $65 billion by 2034, according to one research firm. That's a solid 9.91% compound annual growth rate (CAGR). North America alone represents $10.43 billion of this market, and it's growing even faster at 10.02% annually. Trump's Pro-AI Policies and NVIDIA's Strategic Shift Under President Trump's administration, there's been a concerted effort to boost American leadership in AI. One such initiative is the Stargate Project, a collaborative venture involving OpenAI, SoftBank (TYO:9984), Oracle (NYSE:ORCL) and MGX, which aims to invest up to $500 billion in AI infrastructure across the U.S. by 2029. Aligning with this vision, NVIDIA has unveiled plans to invest hundreds of billions of dollars in U.S.-based manufacturing over the next four years. The move seeks to reduce reliance on Asian supply chains, particularly in light of tariff uncertainties. Speaking to the Financial Times last week, Huang remarked that, over the next four years, NVIDIA will buy "probably half a trillion dollars' worth of electronics in total." He added that he can see the company "manufacturing several hundred billion of it here in the U.S." Even with all the excitement, NVIDIA's stock has formed a death cross, a technical pattern that typically signals near-term weakness. But let's put things in perspective. After meteoric runs in 2023 (when it was up 238%) and 2024 (up 171%), some consolidation is natural, if history is any guide. Also, every Magnificent 7 stock, except Facebook-parent Meta Platforms (NASDAQ:META), is underperforming the S&P 500 year-to-date. I believe these dips can present buying opportunities. NVIDIA's fundamentals remain incredibly strong. In the fourth quarter of 2024, the company reported record revenue of $39.3 billion and record data center revenue of $35.6 billion. It also reported record full-year revenue of $130.5, more than double the amount generated just a year earlier. Sitting in the audience at NVIDIA's GTC Conference, I could feel the same energy that surrounded the dot-com boom, the rise of mobile computing and the emergence of cloud technology. Despite near-term market fluctuations, the investment case for AI remains rock solid. It's clear to me that companies that build AI, use AI or enable AI infrastructure will shape the global economy in the decades to come. ***** All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. By clicking the link(s) above, you will be directed to a third-party website(s). U.S. Global Investors does not endorse all information supplied by this/these website(s) and is not responsible for its/their content. Holdings may change daily. Holdings are reported as of the most recent quarter-end. The following securities mentioned in the article were held by one or more accounts managed by U.S. Global Investors as of (12/31/2024): NVIDIA Corp (NASDAQ:NVDA)., Microsoft Corp (NASDAQ:MSFT)., Alphabet (NASDAQ:GOOGL) Inc., Tesla (NASDAQ:TSLA) Inc.