1. NVIDIA Corporation (NASDAQ:NVDA)
Fwd. P/E: 25
Expected EPS Growth Next FY: 51%
Number of Hedge Fund Holders: 223
Upside Potential: 55%
NVIDIA Corp. (NASDAQ:NVDA) is a leading designer and manufacturer of graphics processing units (GPUs), system-on-a-chip (SoC) solutions, and AI hardware and software. Over the years, the company has expanded beyond gaming GPUs to become a dominant force in data center solutions, AI computing, and deep learning technologies. Its GPUs are widely deployed in data centers for high-performance computing, AI training, and inference, making NVIDIA a crucial player in the data center ecosystem. The company’s products are integral to powering advanced applications in AI, machine learning, and data analytics.
NVIDIA Corp. (NASDAQ:NVDA) benefited significantly from AI-driven enthusiasm in 2024 but has faced investor caution regarding the incremental gains from AI investments. As a result, its stock has declined 16% so far in 2025.
The company’s highly anticipated Q4 2025 (FY ending January) earnings report, released on February 26, exceeded even elevated expectations. Quarterly revenue grew 12% sequentially and 78% year-over-year to $39.3 billion, surpassing estimates by 2%-3%. Data center revenue climbed 16% quarter-over-quarter to $35.6 billion, while adjusted EPS increased 10% sequentially to $0.89. Its Q1 2026 revenue guidance of $43 billion was also ahead of expectations, but gross margin guide was a bit weaker.
NVIDIA Corp. (NASDAQ:NVDA)’s founder and CEO, Jensen Huang, emphasized the strong demand for Blackwell, highlighting its impact on advancing AI capabilities. He explained that increasing compute power enhances both model training and reasoning, driving smarter outcomes. The company has rapidly scaled up Blackwell AI supercomputer production, generating billions in sales within its first quarter. Huang also noted that AI is evolving at an accelerated pace, with agentic and physical AI driving the next wave of innovation, poised to reshape major industries.
Analyst sentiment remains highly favourable for NVIDIA Corp. (NASDAQ:NVDA), with the majority of analysts assigning a Buy rating to the stock. The consensus one-year median price target suggests a potential upside of 55% from current levels.
While we acknowledge the potential of 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 time frame. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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