After a volatile trading day, Nvidia (NASDAQ: NVDA) shares ended in the red on Thursday. The company’s stock fell 1.7% in the session, according to data from S&P Global Market Intelligence.
Nvidia shares opened the day down as much as 7% but rallied to a 2.1% gain on better-than-expected economic data before falling back into bearish territory after some analysts suggested earnings from big tech companies could still disappoint. Investors have been steering clear of the artificial intelligence (AI) leader and other mega-cap tech stocks amid geopolitical risks and valuation concerns, and recent earnings reports from Alphabet And Tesla have increased selling pressure.
Nvidia shares have now fallen in four of the last five daily trading sessions. The company’s stock is now down about 17% from the peak it reached on June 18. Is it time to buy the standout AI stock?
Investors Can Still Make Profits With Nvidia Stock
Nvidia has become a battleground — and perhaps the most influential company when it comes to shaping performance for the stock market at large. Its graphics processing units (GPUs) and other accelerated computing technologies are the go-to platform for powering advanced AI applications.
The company’s existing strengths in data center computing technologies have been augmented by the rising demand for AI services, and the company has seen tremendous revenue and profit growth in tandem with the trend. On the other hand, the incredible rise of artificial intelligence technologies is a relatively recent phenomenon — and that makes it difficult to chart future performance and predict valuations.
Valuations for AI stocks are likely to see a significant degree of volatility in the coming years as investors attempt to assess economic opportunities created by advances in the technology. But Nvidia has strong competitive advantages thanks to its category-leading GPUs and related software platform, and there’s a good chance the company will maintain a dominant position in the key category of artificial intelligence hardware.
For long-term investors looking to build exposure to hardware technologies driving key AI trends, taking a dollar-cost-averaging approach to Nvidia stock seems like a smart move right now.
Should You Invest $1,000 in Nvidia Now?
Before you buy Nvidia stock, here are some things to consider:
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Nvidia, and Tesla. The Motley Fool has a disclosure policy.
Nvidia Drops Again Today — Time to Buy Shares of the Artificial Intelligence (AI) Leader? was originally published by The Motley Fool
