Nvidia’s (NVDA) Teflon stock may be taking a bit of a nose dive as the year comes to a close, but a new chapter awaits the darling of the AI market — and with it. Experts and investors believe that a more impressive quarterly growth is expected.
“NVIDIA is printing money like Apple did in the early days of the iPhone,” Ross Gerber, president of Gerber Kawasaki Wealth and Investment Management, told Yahoo Finance’s Catalysts (video above). “The opportunities for AI are somewhat limitless at this point,” he said. ”
Gerber, who has invested in Nvidia for the past decade since it gained popularity with its high-performance gaming chips, believes the company is entering the “next phase” of growth.
This growth will be driven primarily by the rapid build-out of artificial intelligence infrastructure globally, powered by Nvidia’s cutting-edge chips.
“NVIDIA is not a very expensive stock, but it’s also not a cheap stock,” Gerber said. “But given the actual profits they’re bringing in and their dominant position in the chip business, the next five years should be very good for Nvidia.”
“There’s no way I’m going to quit now,” he added. “So for investors, Nvidia should be part of their portfolio, just like Apple or Microsoft.”
The excitement about Nvidia’s future is reflected in the influx of retail investors.
NVIDIA has received $30 billion in retail investor inflows so far this year, according to data from Vanda Research. This makes Nvidia the most popular stock among retail investors in 2024, surpassing the SPDR S&P 500 ETF (SPY) with $15.3 billion in inflows and Tesla (TSLA) with $14.7 billion in inflows.
Nvidia CEO and Founder Jensen Huang attends the Siam.AI Cloud event in Bangkok on December 4, 2024. (Lillian SUWANRUMPHA / AFP via Getty Images) · LILLIAN SUWANRUMPHA via Getty Images
But some traders chose to jump off Nvidia’s rocket ship this month.
The new Dow Jones Industrial Average has increased just 0.7% over the past month. The Dow Jones Industrial Average has fallen 10% in the past month, and the S&P 500 index has fallen about 1.7%.
Nvidia stock is up 181% year-to-date.
Vivek Arya, a semiconductor analyst at Bank of America, said the company’s stock is going through a period of soul-searching. This is due to several factors, including implementation issues in trying to drive cutting-edge innovation and concerns about exposure to China ahead of potential tariffs with President Trump’s return. There is.
“Some of these (problems) are due to company-specific forces,” Arya said on Yahoo Finance’s Opening Bid Podcast (listen below), and “some of these are due to market forces. ” he said.
Arya explained that the switch to Nvidia’s Blackwell AI chip, which won Yahoo Finance’s 2024 Product of the Year award, has not been smooth, which is spooking the bulls.
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“The last two quarters have not been pretty as we are experiencing growing pains from one generation of products to a new generation,” Arya said.
Blackwell, which the company announced at its annual GPU conference in March, was hailed as Nvidia’s most powerful and innovative product. However, delivering a finished idea to the masses in the form of a product has proven more difficult.
“What we’ve seen since (March) is that enforcement issues are out of the hands of customers,” he said.
Now Wall Street’s eyes will turn to the success that will unleash Blackwell into a market hungry for its product. Aria believes Blackwell will achieve multi-billion dollar sales in 2025.
Additionally, NVIDIA founder and CEO Jensen Huang’s keynote speech at CES 2025 in early January could provide a short-term boost to the stock price.
Sell-side analysts expect Nvidia to increase net sales by $65 billion year-over-year in 2025 and more than double earnings per share, according to data from Yahoo Finance.
“These are the only games in town,” Wedbush technology analyst Dan Ives said during the bid opening. (AI) The foundation starts with Nvidia. That hasn’t changed. ”
Brian Sozzi is editor-in-chief of Yahoo Finance. Follow Sozzi on X @BrianSozzi And also on LinkedIn. Have a tip about a deal, merger, activist situation, or more? Email brian.sozzi@yahoofinance.com.
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