Nvidia (NASDAQ:NVDA) is well-known as the dominant U.S. manufacturer of chips, and especially graphics processing units, for artificial intelligence applications. Today, our Nvidia stock analysis will conclude that investors have valid reasons to maintain their share positions in Nvidia this year.
In other words, the rally isn’t finished yet and NVDA stock still fully deserves an “A” grade. But don’t just take our word for it. Conduct your own due diligence, and you’ll surely see the signs that Nvidia is still a tech-market titan in 2024.
This Famous Company Picked Nvidia for AI Components
Nvidia is the go-to source of AI-ready hardware components for a multitude of companies, including some famous ones. In fact, we’ve just learned that another “Magnificent Seven” company plans to deploy a huge number of Nvidia GPUs this year.
Here are the details. Reportedly, Meta Platforms (NASDAQ:META) will have hundreds of thousands of Nvidia-made graphics processing units by the end of this year. This information comes straight from the mouth of Meta Platforms CEO Mark Zuckerberg (via a Barron’s report).
According to Zuckerberg, Meta Platforms will have 350,000 of Nvidia’s H100 GPUs and nearly 600,000 H100 compute-equivalent GPUs by the end of 2024. This is part of Zuckerberg’s plan to build “massive compute infrastructure to support” Meta Platforms’ “future roadmap” for AI.
We’re not talking about cheap chips here. The H100 data-center GPU reportedly costs around $25,000 per unit. Per Barron’s, if Meta Platforms buys 350,000 of these GPUs, it will cost nearly $9 billion. Thus, Meta Platforms’ GPU purchases will provide a sizable revenue source for Nvidia.
NVDA Stock Investors Should Be Confident
Why should Nvidia’s shareholders be confident? We already mentioned that Meta Platforms is a major buyer of Nvidia’s products. Plus, analysts are overwhelmingly bullish about NVDA stock.
Nvidia’s chief executive is extremely confident about the global demand for AI-enabled hardware components. This is significant because Nvidia CEO Jensen Huang certainly has an insider’s perspective on the AI-processor industry’s future.
Not long ago, Huang observed that the global demand for AI-compatible chips is booming. Calling AI a “rebirth of the industry,” the Nvidia CEO assured investors, “Last year was the beginning. This year is going to be a huge year.”
The implication here, we can assume, is that it would be premature for Nvidia’s investors to take profits now. Clearly, the demand for AI-enabled components isn’t an issue for Nvidia. Huang stated that Nvidia is “working very hard” to “keep up with the demand” for these components, and he described the demand as “very strong.”
Nvidia Stock Analysis: It’s Still a Smart Bet on AI Components
We’ve made Huang’s confident outlook part of our Nvidia stock analysis today. The CEO’s optimism adds to the already compelling bull case, and might convince Nvidia’s investors not to take profits yet.
And if you don’t currently own any Nvidia shares, it’s not too late to consider a long position. At the end of the day, we’re assigning an “A” grade to NVDA stock and encourage investors to take a fresh look at this market-dominating juggernaut.
On the date of publication, Louis Navellier had a long position in NVDA. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
