It’s normal for investors who don’t own stocks Nvidia (NASDAQ: NVDA) stocks to think they missed something. After all, the share price is up 243% in the last year, and 543% in the last three years. But instead of looking back, let’s look forward and see if there’s more room to run.
Nvidia isn’t just an artificial intelligence (AI) company. It has four business segments, and each of them achieved sequential quarter-over-quarter revenue growth, as well as year-over-year increases in the latest quarterly period. The data center segment that supports the growing need for advanced AI computer chips is growing the fastest, and many more may follow.
Prediction: Another $1 trillion investment is coming
In February, Nvidia CEO Jensen Huang made this prediction: “There’s about a trillion dollars of installed data centers. Over the next four or five years, we’ll have $2 trillion of data centers that will be available.” powering software around the world.”
Nvidia already has a market cap of about $3.4 trillion. But if he’s right, that’s a significant amount of additional revenue for the undisputed AI leader. And there are mounting indications that Huang’s prediction is coming true.
Microsoft recently gave investors an idea of how much data center spending has exploded. In its latest 10-K annual report, filed for fiscal year 2024 (ending in June), Microsoft noted that it had $108.4 billion in capital lease obligations for data centers that will begin over the next five years. That’s almost $100 billion more than two years ago, and these leases have a term of up to twenty years.
Not many investors saw the explosive growth of AI data centers coming. However, there still appears to be plenty of growth left for that segment, and it’s a good reason to buy Nvidia stock now. And don’t forget the other businesses, such as automotive and robotics, that could follow as advances are made in self-driving cars and companies look for more automation.
Don’t miss this second chance at a potentially lucrative opportunity
Have you ever felt like you missed the boat on buying the most successful stocks? Then you would like to hear this.
On rare occasions, our expert team of analysts provides a “Double Down” Stocks recommendation for companies they think are about to pop. If you’re worried that you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
-
Amazon: If you had invested $1,000 when we doubled in 2010, then you have $21,285!*
-
Apple: If you had invested $1,000 when we doubled in 2008, you would have $44,456!*
-
Netflix: If you had invested $1,000 when we doubled in 2004, you would have $411,959!*
We’re currently issuing ‘Double Down’ warnings for three incredible companies, and another opportunity like this may not happen anytime soon.
See 3 “Double Down” Stocks »
*Stock Advisor returns October 21, 2024
Howard Smith has positions at Microsoft and Nvidia. The Motley Fool holds positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has a disclosure policy.
Do you think it’s too late to buy Nvidia? This is the biggest reason why there is still time. was originally published by The Motley Fool
