Nvidia (NVDA 4.11%) was one of the market's hottest growth stocks of the past decade. From the first trading day of 2014 to the last trading day of 2024, its stock surged 33,430%.
Tariffs, trade policy, and the risk of recession have all contributed to market turmoil lately. That's led to a massive increase in volatility in one of the market's biggest stocks.
Shares of Nvidia (NVDA 4.41%) are surging higher on Friday. The AI chip giant's stock had gained 4% as of 1:50 p.m.
AI is shifting from simple Q&A to autonomous "agentic" systems (like OpenAI's o3/o4) that can manage complex workflows, driving a new paradigm in AI capabilities and use cases. Agentic AI requires orders of magnitude more computational power per task and benefits from more inference-time compute, unlocking new applications and fueling a potential compute. Nvidia Corporation provides the critical hardware for this compute surge, leading to record financial performance and rapid operational scaling to meet demand.
Jim Cramer breaks down why he's keeping an eye on shares of Nvidia.
Looking at the current P/E ratio, Nvidia Corporation stock trades as if it is 2022 again, meaning that the market does not price in any AI factor at all. Alphabet/Google's strong earnings release yesterday, together with their $75 billion AI spending plan, bolster Nvidia's long-term growth, supported by aggressive innovation and promising collaborations. NVDA's strategic U.S. manufacturing expansion and partnerships with industry-leading players will help mitigate geopolitical risks and might uncover new operating efficiencies.
Chip export restrictions to China have been an overhang on Nvidia (NVDA 3.56%) shares. But after dipping below the $100 level, Bank of America analyst Vivek Arya believes the leading artificial intelligence (AI) chipmaker is worth buying.
Nvidia's $60.7B FY2025 FCF supports a DCF valuation of ~$469 (bull), ~$100 (base), and ~$50 (bear) per share. The Blackwell NVL72 platform shifts Nvidia from episodic training cycles to recurring inference monetization, driving SaaS-like cash flows. Over 5.9 million CUDA developers are vendor-locked, reinforcing Nvidia's moat through protocol capture and developer ecosystem inertia.
Nvidia Corporation's stock dropped 18% since August, but recent developments, including U.S. tariff reductions, nearshoring, and new product launches, reduce investment risks. Nvidia's U.S. manufacturing expansion and new GeForce RTX 5060 GPUs could boost revenue, despite challenges from China's AI advancements. Nvidia reported record Q4 revenue, driven by data centers and Blackwell sales, with a forward GAAP P/E ratio of 23.33x, aligning with the sector.
The trade war with China has been tough on Nvidia Corp. (NASDAQ: NVDA) investors.
Though CNBC's Jim Cramer is arguably best known for making perfectly-timed wrong calls, his most persistent stock pick has been the wildly successful semiconductor giant Nvidia (NASDAQ: NVDA).
Nvidia faces restrictions on exports to China but negotiations could reduce fears over sector-specific levies on imported semiconductors.