Investors love seeing the big growth behind the rollout of generative AI. But after two years of rallies in the big-cap stocks, concerns are mounting about whether or not these companies can keep up big growth.
While growth is likely to slow, new iterations of technology will likely ensure above average growth continues as new AI programs are developed, data centers are created, and as hardware demand remains robust.
That’s why tech giant Nvidia (NVDA) could still have a great year, adding to massive gains. Nvidia just unveiled its latest Blackwell cards, and unveiled an AI supercomputer that will better take advantage of Nvidia’s lead in the GPU space.
It’s clear that Nvidia is rising to the challenge of keeping the growth going, although the market is still a bit skeptical about how much growth may slow.
For now, Nvidia remains a powerhouse, with earnings up 168% over the past year and revenues surging 122%. With shares valued at 35 times earnings, Nvidia is still well priced for future growth.
Action to take: Investors who aren’t already in the stock may want to accumulate shares on any 10% pullback, as long as the growth trends remain in place, which looks likely to be the case into 2025.
For traders, the May $175 calls, last trading for about $7.10, could see mid-double-digit returns from any push higher in the coming months.
Disclosure: The author of this article has a position in the company mentioned here, but does not intend to further trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.