Recently, we covered 7 unstoppable artificial intelligence (AI) stocks. Let's discuss whether NVIDIA Corporation (NASDAQ:NVDA) is the most unstoppable AI stock. The company has been garnering attention and traction from WallStreetBets analysts, hedge funds, and even individual investors. To see other unstoppable AI stocks, 7 Unstoppable Artificial Intelligence (AI) Stocks to Buy.
NVIDIA's Position in the AI Industry
NVIDIA Corporation (NASDAQ:NVDA) makes industry-leading GPUs for AI applications and is at the forefront of the AI boom. The company's new Blackwell GPUs, due for release by the end of the year, will be capable of generating trillion-parameter AI models. The company is also investing heavily in developing AI software products, including its Advanced AI platform for enterprises, which provides generative AI, data analytics, and inference.
NVIDIA Corporation (NASDAQ:NVDA) is signing deals with leading technology companies to boost demand for its industry-leading GPUs. On May 21, NVIDIA Corporation (NASDAQ:NVDA) announced that it is partnering with Microsoft Corporation (NASDAQ:MSFT) to accelerate the development and deployment of AI applications. Microsoft Corporation (NASDAQ:MSFT) has developed AI models optimized to run on NVIDIA GPUs, the Phi-3 family of small language models. NVIDIA Corporation (NASDAQ:NVDA) also offers microservices such as CuOpt route optimization AI, which has been added to the Microsoft Azure Marketplace and is part of the NVIDIA AI Enterprise Platform. The two companies are also working closely to develop various optimizations and integrations for developers to create AI applications. These optimizations and integrations will be available on PCs with NVIDIA GeForce RTX and NVIDIA RTX GPUs.
On May 22, NVIDIA Corporation (NASDAQ:NVDA) announced strong results for the first quarter of fiscal year 2025. The company reported earnings per share of $6.12, beating expectations by $0.54. The company announced staggering quarterly revenue of $26.04 billion, up 262% year over year and beating market consensus by $1.45 billion. The company's data center revenue grew 23% to $22.6 billion, driven primarily by demand for its Hopper GPU computing platform. Large cloud providers, which are NVIDIA Corporation's (NASDAQ:NVDA) AI infrastructure customers, accounted for 40% to 50% of data center revenue. Here are some comments from the company's Q1 2025 earnings call:
“In the first quarter, we worked with over 100 customers to build AI factories ranging from hundreds to tens of thousands of GPUs, with some reaching 100,000 GPUs. From a geographic perspective, data center revenues continue to diversify as countries around the world invest in sovereign AI, which refers to a nation's ability to create artificial intelligence using its own infrastructure, data, workforce, and business networks.”
The comments also highlighted the role of the new Blackwell GPUs.
“At GTC in March, we announced our next-generation AI factory platform, Blackwell. The Blackwell GPU architecture delivers up to 4x faster training and 30x faster inference than H100, enabling real-time generative AI on trillion-parameter large-scale language models. Blackwell is a giant leap forward with up to 25x lower TCO and energy consumption than Hopper. The Blackwell platform includes 5th generation NVLink with multi-GPU spine, new InfiniBand and Ethernet switches, and X800 series designed for trillion-parameter scale AI. Blackwell is designed to universally support data centers, from hyperscale to enterprise, training to inference, x86 to Grace CPUs, Ethernet to InfiniBand networks, and air-cooled to liquid-cooled.”
Photo by Christian Wiediger on Unsplash
What does the stock split mean for NVIDIA?
NVIDIA Corporation (NASDAQ:NVDA) also announced a 10-for-1 stock split and a 150% dividend increase at the same time as its financial results on May 22. On May 23, Lou Basenese, president and chief market strategist at Public Ventures, appeared in an interview. Yahoo Finance There, he discussed the stock's performance after the company's long-awaited earnings announcement. As of May 23, the company's shares are up 90% year-to-date and it reported strong earnings. However, the analyst expressed concern about NVIDIA Corporation (NASDAQ:NVDA)'s slight earnings beat. According to Basenese, the company beat earnings expectations by 8%, which was the smallest to date compared to the 40% beat in the first strong quarter before the AI boom. In response to NVIDIA Corporation's (NASDAQ:NVDA) decision to split its stock, Basenese suggested that the move was great if viewed through a psychological lens. He suggested that 40% of trading volume was from retail investors, and that a stock split would eventually attract more retail investors. He concluded his discussion by emphasizing that NVIDIA Corporation's (NASDAQ:NVDA) products are the backbone of AI applications produced by megatech companies, meaning that earnings results were fairly predictable.
On May 23, Morgan Stanley maintained an Overweight rating on NVIDIA Corporation (NASDAQ:NVDA) and raised its price target from $1,000 to $1,160. Meanwhile, Rosenblatt maintained a Buy rating on the stock and maintained its price target at $1,400. Over the past three months, 36 Wall Street analysts have held a Buy equivalent rating on NVIDIA Corporation (NASDAQ:NVDA) with an average price target of $1,104. The company's expected high price of $1,400 represents a 5.65% increase from the company's May 23 stock price of $1,041.19. According to analysts surveyed by Yahoo Finance, NVIDIA Corporation (NASDAQ:NVDA) is expected to see its earnings per share increase by 94% in 2025 compared to 2024. Despite NVIDIA Corporation's (NASDAQ:NVDA) strong earnings report and impressive performance so far this year, the company ranks second on our list of most momentum stocks.
If you're interested in buying some of the hottest AI stocks, 7 Unstoppable Artificial Intelligence (AI) Stocks to Buy.
If you're looking for AI stocks that are as promising as Microsoft but trade at less than five times earnings, check out our report. Cheapest AI Stocks. Read next: Michael Burry sells these stocks and a new dawn dawns for US stocks.
Disclosures: None. This article was originally published on Insider Monkey.
