1. NVIDIA Corporation (NASDAQ:NVDA)
5 Year Revenue Growth: 62.43%
5 Year Net Income Growth: 92.10%
TTM Net Income: $53.01 Billion
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) is a leader when it comes to AI infrastructure. Previously its Gaming Processing Units (GPUs), revolutionized the PC gaming market and redefined computer graphics. At present its GPUs are powering the AI infrastructure from computers to data centers, autonomous driving vehicles, and robots.
While the Gaming segment engine of the company is still running, its application in the data center industry has shifted gears for the company. The company has grown to become the best extremely profitable stock to buy now. It has grown its revenue by 62% and net income by 92% over the past 5 years. Whereas, its trailing twelve-month net income stands at an impressive $53.01 billion.
To cater to the growing needs of data centers and artificial intelligence, NVIDIA Corporation (NASDAQ:NVDA) launched its Hopper platform in September 2022, which is a GPU architecture designed to handle high-performance computing. Currently, the Hopper platform demand for data centers is leading the company. During the third quarter results for fiscal 2025, total revenue of $35.1 billion for the company was driven by record year-over-year Data Center revenue growth of 112%.
The Data Center segment witnessed its H200 GPU sales increase to double-digit billions of dollars, which the management categorized as the fastest product ramp-up in its history. Moreover, its latest Blackwell platform architecture is also in full production and management anticipates its demand for Blackwell and Hopper platform will continue to increase due to their effective use cases in the artificial intelligence industry.
Columbia Seligman Global Technology Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2024 investor letter:
“The fund held an underweight position in NVIDIA Corporation (NASDAQ:NVDA) relative to the S&P North American Technology Sector, which was a headwind on performance following impressive returns from the company in 2023 and the first two quarters of 2024. NVIDIA’s stock fell during periods of the quarter after the company reported second quarter earnings. While the earnings came in higher than expectations, investors were concerned that the company did not guide earnings high enough, signaling a potential slowdown in AI buildout. NVIDIA’s demand remains strong and the company has forecast orders for upcoming quarters. The question that remains is whether the company can meet the demand for its AI processors and connectivity chips. Our team continues to remain cautious on NVIDIA’s high customer concentration. Microsoft and Meta have driven a significant amount of the company’s revenue, which presents added risk.”
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for a promising AI stock that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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