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NVIDIA (NVDA) Up 82.5% in Q1: Can It Sustain the Momentum?
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NVIDIA Corporation (NVDA - Free Report) has witnessed a remarkable run, showcasing a staggering 82.5% surge in its stock price in the first quarter of 2024, pushing the company to the forefront of technology and innovation. NVIDIA also achieved a massive milestone in March 2024 by joining the exclusive club of companies with more than $2 trillion market capitalization.
The surge reflects investors' confidence in NVIDIA's strategic positioning, robust financial performance and pivotal role in shaping transformative technologies like artificial intelligence (AI), gaming and data center solutions.
However, the looming question remains — Can NVIDIA sustain this momentum in the quarters ahead?
NVIDIA’s robust stock price performance has been primarily driven by hopes that the company will be a prime beneficiary of growing investments in generative AI. Given generative AI’s inherited opportunities and the company’s leadership in the space, we believe the NVDA stock is poised to carry the momentum in 2024.
NVIDIA dominates the market for AI chips. The meteoric rise of OpenAI’s ChatGPT and its adoption among enterprises have already proven generative AI technology’s usefulness across multiple industries, including marketing, advertising, customer service, education, content creation, healthcare, automotive, energy & utilities and video game development.
The growing demand to modernize the workflow across industries is expected to drive the demand for generative AI applications. The global generative AI market size is anticipated to reach $967.6 billion by 2032, according to a new report by Fortune Business Insights. The market is expected to expand at a CAGR of 39.6% from 2024 to 2030.
However, generative AI requires vast knowledge to create content and needs huge computational power. As a result, enterprises looking to create generative AI-based applications will be required to upgrade their existing network infrastructure.
NVIDIA’s next-generation chips with high computing power can be the top choice for enterprises. The company’s GPUs are already being applied in AI models. This is expanding NVDA’s footprint in untapped markets like automotive, healthcare and manufacturing.
The generative AI revolution is likely to create huge demand for its next-generation high computing powerful chips. Considering surging AI investments across the data center end market, NVDA expects its first-quarter fiscal 2025 revenues to reach $24 billion from $7.19 billion in the year-ago quarter.
Additionally, NVIDIA currently sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of B. Our research shows that stocks with a Growth Score of A or B when combined with a Zacks Rank #1 or #2 (Buy) offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment. You can see the complete list of today's Zacks #1 Rank stocks here.
Other Stocks Worth Considering
Some other top-ranked stocks worth considering in the broader technology sector include Meta Platforms (META - Free Report) , Zscaler (ZS - Free Report) and Twilio (TWLO - Free Report) .
Meta Platforms currently sports a Zacks Rank #1 and has a Growth Score of B. The Zacks Consensus Estimate for the company’s 2024 earnings has been revised 13% upward to $19.94 per share in the past 60 days, which suggests year-over-year growth of 91.6%. The long-term estimated earnings growth rate for the stock stands at 19.5%.
Zscaler carries a Zacks Rank #2 and has a Growth Score of A at present. The Zacks Consensus Estimate for the company’s fiscal 2024 earnings has been revised upward by 26 cents to $4.03 per share in the past 30 days, which calls for an increase of 52.5% on a year-over-year basis. The long-term expected earnings growth rate for the stock is pegged at 28.1%.
Twilio carries a Zacks Rank #2 and has a Growth Score of A. The consensus mark for Twilio’s 2024 earnings has been revised upward by 6 cents to $2.70 per share over the past seven days, which indicates a 10.2% increase from 2023. It has a long-term earnings growth expectation of 19.6%.
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NVIDIA (NVDA) Up 82.5% in Q1: Can It Sustain the Momentum?
NVIDIA Corporation (NVDA - Free Report) has witnessed a remarkable run, showcasing a staggering 82.5% surge in its stock price in the first quarter of 2024, pushing the company to the forefront of technology and innovation. NVIDIA also achieved a massive milestone in March 2024 by joining the exclusive club of companies with more than $2 trillion market capitalization.
The surge reflects investors' confidence in NVIDIA's strategic positioning, robust financial performance and pivotal role in shaping transformative technologies like artificial intelligence (AI), gaming and data center solutions.
However, the looming question remains — Can NVIDIA sustain this momentum in the quarters ahead?
NVIDIA Corporation Price and Consensus
NVIDIA Corporation price-consensus-chart | NVIDIA Corporation Quote
GenAi Investments to Aid NVDA’s Surge
NVIDIA’s robust stock price performance has been primarily driven by hopes that the company will be a prime beneficiary of growing investments in generative AI. Given generative AI’s inherited opportunities and the company’s leadership in the space, we believe the NVDA stock is poised to carry the momentum in 2024.
NVIDIA dominates the market for AI chips. The meteoric rise of OpenAI’s ChatGPT and its adoption among enterprises have already proven generative AI technology’s usefulness across multiple industries, including marketing, advertising, customer service, education, content creation, healthcare, automotive, energy & utilities and video game development.
The growing demand to modernize the workflow across industries is expected to drive the demand for generative AI applications. The global generative AI market size is anticipated to reach $967.6 billion by 2032, according to a new report by Fortune Business Insights. The market is expected to expand at a CAGR of 39.6% from 2024 to 2030.
However, generative AI requires vast knowledge to create content and needs huge computational power. As a result, enterprises looking to create generative AI-based applications will be required to upgrade their existing network infrastructure.
NVIDIA’s next-generation chips with high computing power can be the top choice for enterprises. The company’s GPUs are already being applied in AI models. This is expanding NVDA’s footprint in untapped markets like automotive, healthcare and manufacturing.
The generative AI revolution is likely to create huge demand for its next-generation high computing powerful chips. Considering surging AI investments across the data center end market, NVDA expects its first-quarter fiscal 2025 revenues to reach $24 billion from $7.19 billion in the year-ago quarter.
Additionally, NVIDIA currently sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of B. Our research shows that stocks with a Growth Score of A or B when combined with a Zacks Rank #1 or #2 (Buy) offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment. You can see the complete list of today's Zacks #1 Rank stocks here.
Other Stocks Worth Considering
Some other top-ranked stocks worth considering in the broader technology sector include Meta Platforms (META - Free Report) , Zscaler (ZS - Free Report) and Twilio (TWLO - Free Report) .
Meta Platforms currently sports a Zacks Rank #1 and has a Growth Score of B. The Zacks Consensus Estimate for the company’s 2024 earnings has been revised 13% upward to $19.94 per share in the past 60 days, which suggests year-over-year growth of 91.6%. The long-term estimated earnings growth rate for the stock stands at 19.5%.
Zscaler carries a Zacks Rank #2 and has a Growth Score of A at present. The Zacks Consensus Estimate for the company’s fiscal 2024 earnings has been revised upward by 26 cents to $4.03 per share in the past 30 days, which calls for an increase of 52.5% on a year-over-year basis. The long-term expected earnings growth rate for the stock is pegged at 28.1%.
Twilio carries a Zacks Rank #2 and has a Growth Score of A. The consensus mark for Twilio’s 2024 earnings has been revised upward by 6 cents to $2.70 per share over the past seven days, which indicates a 10.2% increase from 2023. It has a long-term earnings growth expectation of 19.6%.