NVDA or PLTR: Which Stock is a Long-Term Bet for Investors in the AI Boom?
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Nvidia is the undisputed leader in AI hardware, powering everything from data centers to autonomous vehicles. Meanwhile, Palantir is a key player in AI-driven software solutions for government and enterprise clients. For long-term investors looking to benefit from the AI boom, Nvidia and Palantir present two compelling but different opportunities, each with its own strengths and long-term potential. Let's break it down.
Is Nvidia Still a Good Stock to Buy?
Nvidia stock is up about 29% year-to-date, bouncing back from earlier setbacks tied to tariff pressures and chip export restrictions. The recent rally gained further momentum as Nvidia became the first company to cross the $4 trillion mark. Investors were also encouraged by news that U.S. authorities have cleared the company to resume sales of its H20 AI chip in China. This marked a significant turning point for Nvidia, as the chip had been blocked in April under stricter export rules, causing a notable financial setback for the company.
Wall Street remains broadly bullish on Nvidia, with most analysts backing the stock, except for one Sell rating from Jay Goldberg of Seaport Global Securities. While he acknowledges Nvidia's central role in the AI boom, Goldberg believes the stock already prices in much of its future growth.
However, bullish analysts point to strong early demand for the new Blackwell chip and solid earnings performance as key catalysts for NVDA stock. Major firms like Bernstein, Needham, Bank of America, and Citi maintain Buy ratings. Analysts see Nvidia not just as a chipmaker but as a key supplier powering the global AI boom.
Is Palantir a Good Stock to Invest In?
Palantir stock has skyrocketed over 100% in 2025, driven by growing demand for its AI-powered solutions. The company remains a key defense tech partner, with most of its revenue tied to U.S. government contracts, especially from the Department of Defense.
However, its lofty valuation, trading at a forward P/E of 264.6 compared to the sector average of 24.3, raises questions about whether the price truly reflects its growth potential. Still, many investors are willing to overlook the premium, betting on its strong ties with the U.S. government and a fast-growing, high-margin commercial business. In short, PLTR's rally appears fueled more by AI enthusiasm than by traditional fundamentals.
Furthermore, Wall Street's enthusiasm for Palantir remains strong. Wedbush's four-star-rated analyst Daniel Ives recently raised his price target on PLTR to a Street-high $160, maintaining his Buy rating. Ives called Palantir 'one of the best AI plays in the world' and even floated the possibility of it becoming a $1 trillion company. While he admits the stock looks pricey, he believes Palantir is uniquely positioned to capitalize on the trillions in global AI spending ahead.
Using TipRanks' Stock Comparison Tool, we have compared NVDA and PLTR to see which stock offers higher upside to investors. NVDA stock currently holds a Strong Buy rating, with an average price target of $182.06, implying a modest 5% upside from current levels.
On the other hand, PLTR stock carries a Hold consensus among 16 analysts. Palantir's average stock price target of $104.85 suggests a downside of over 30%.
Conclusion
In conclusion, Nvidia and Palantir give investors two different ways to benefit from the AI boom. Nvidia is a safer choice with steady growth and strong market power. In contrast, Palantir is riskier but could deliver bigger rewards if its AI software keeps growing fast. Together, they can offer a balanced approach of stability and growth potential.
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