Is Nvidia an Undervalued Growth Stock or a Falling Knife?

From Nasdaq: 2025-04-26 04:18:00

Nvidia (NASDAQ: NVDA) experienced explosive growth with its stock surging 33,430% from 2014 to 2024. Revenue grew at a CAGR of 39% and EPS at 58% from 2015 to 2025. The data center GPU sales fueled growth as the generative AI market expanded, making Nvidia a leader in AI technology.

Nvidia’s data center GPUs are in high demand due to their fast processing of AI tasks. Top AI companies like OpenAI and Google use Nvidia’s chips, accounting for 88% of its revenue. Despite a 23% stock decline in 2025, Nvidia’s strong position in the AI market remains solid.

In fiscal 2025, Nvidia saw remarkable growth with revenue up 114%, data center revenue up 142%, adjusted gross margin at 75.5%, and adjusted EPS growth of 130%. However, there are concerns about slowing growth rates and declining margins in the near term.

Nvidia is facing challenges from macroeconomic headwinds and competition from chipmakers like AMD and Huawei. CEO Jensen Huang remains optimistic about the mainstream adoption of AI. Nvidia’s stock price may present a buying opportunity for investors who believe in the company’s long-term potential.

Nvidia controls 98% of the data center GPU market and remains ahead of competitors. Despite slowing growth, Nvidia’s stock appears undervalued. Investors who weather volatility could benefit from the company’s strong position in the AI market.

Nvidia’s future growth potential remains promising, making it a potential investment opportunity. The company’s leadership in AI technology and data center GPUs positions it well for continued success in the expanding market. Investors may find value in Nvidia’s stock amid market volatility.



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