‘On the Road to $5 Trillion,' Says Top Investor About Nvidia Stock
Nvidia (NASDAQ:NVDA) stock continues its steady climb – up 45% from April's low – supported by easing tariff concerns and the company's dominant position in the AI data center space. With analysts projecting a 66% year-over-year revenue surge, expectations are high as Nvidia gets set to report its FY 2026 Q1 earnings after today's market close.
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Among the potential catalysts for continued growth is Nvidia's newly announced partnership with Saudi Arabia's HUMAIN. This collaboration involves the construction of AI factories in Saudi Arabia, powered by Nvidia's advanced GPUs, including an initial deployment of 18,000 GB300 Grace Blackwell AI superchips. These facilities are designed to provide the infrastructure necessary for training and deploying AI models at scale. As the Kingdom pursues its ambitions to become a global AI leader, this collaboration could open up new opportunities for Nvidia in emerging markets.
At the same time, Nvidia's push into physical AI is catching the eye of top investors. One such investor, known by the pseudonym KM Capital, sees this trend as a key growth frontier for the chipmaker.
'Nvidia is striving to get a first-mover advantage in this potentially explosive market as the company expands its 'real-world AI' ecosystem via collaborations,' explains the 5-star investor, who is among the top 4% of TipRanks' stock pros.
To that end, Nvidia is actively pursuing partnerships in the automotive sector, having inked deals with GM, Uber, and Volvo, among others. Looking long-term, the investor cites a Morgan Stanley research report that predicts robotic humanoids will represent a $5 trillion market by 2050.
That does not mean that generative AI is losing any momentum in the here and now, as competition continues to heat up. As evidence, the investor points out that most IT spending in the next twelve months is expected to be in the AI/ML category. The fact that Taiwan Semiconductor just raised prices is a further demonstration that Nvidia and its AI contemporaries are sitting pretty, argues the investor.
'This is a bullish indicator for the entire industry, because the ability to exercise pricing power means that the demand is soaring,' adds KM.
Looking ahead, KM projects Nvidia can maintain a 7% constant growth rate, which, by his calculations, puts a $5 trillion market cap within reach.
'I am absolutely confident that Nvidia is significantly undervalued, which makes the stock a no-brainer 'Strong Buy,'' concludes KM (To watch KM Capital's track record, click here)
Wall Street feels very strongly about Nvidia as well. With 32 Buy, 4 Hold, and 1 Sell recommendations, Nvidia enjoys a Strong Buy consensus rating. Its 12-month average price target of $164.21 would yield gains of ~20% in the year ahead. (See NVDA stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
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