Key Takeaways
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Nvidia’s stock has decreased from its peak.
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Despite this, the company’s operations remain strong.
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The stock appears undervalued given its future growth prospects.
On October 29, 2025, Nvidia (NASDAQ: NVDA) reached an all-time high of $207.03 per share, raising its market cap to $5.03 trillion—making it the first company ever to surpass the $5 trillion threshold.
However, the stock has since dropped by 11%, bringing its market cap down to around $4.5 trillion. Some analysts are concerned that the so-called “AI bubble” might lead to further declines. I’m not so sure, though. If Nvidia can navigate these short-term hurdles, I suspect the stock could bounce back to or exceed $5 trillion by year-end.
What Are the Concerns from Bears?
Nvidia’s stock has skyrocketed nearly 1,200% over the last five years, largely thanks to the booming AI sector. GPUs from Nvidia excel in handling complex AI tasks better than traditional CPUs, as they’re designed for parallel processing.
Many leading AI companies rely on Nvidia’s data center GPUs to refine their algorithms. The company dominates over 90% of the discrete GPU market, securing its customer base with its proprietary programming platform, CUDA, and various specialized services. Essentially, Nvidia is still capitalizing on the AI craze.
Analysts predict that Nvidia’s revenue and earnings per share (EPS) will grow at an impressive compound annual growth rate (CAGR) of 47% and 46%, respectively, from FY2025 through FY2028, as the AI market evolves. This robust growth is notable considering its current P/E ratio is at 24 for the next year.
However, critics suggest that the pace might slow down due to intensifying competition from local players like AMD and Broadcom, who are releasing less expensive data center GPUs and custom AI accelerators.
Can Nvidia’s Market Cap Reach $5 Trillion Again?
While these points are worth discussing, I think Nvidia’s size, reliability, and strong ecosystem will likely keep it at the forefront of the expanding AI market for a considerable period. There’s probably sufficient space for AMD, Broadcom, and other custom chip manufacturers to thrive without competing directly.
If Nvidia meets expectations and maintains a forward P/E ratio of 24, its stock could rise around 20% within the next year, which would easily help its market cap exceed $5 trillion again, paving the way for further growth in the following years.
Should You Consider Buying Nvidia Stock Now?
Before deciding to invest in Nvidia, keep in mind the insights from our analyst team. They’ve listed what they believe are the top-tier stocks to invest in right now, and surprisingly, Nvidia isn’t included. These picks have the potential to yield substantial returns over the near term.
For reference, if you had invested $1,000 in Netflix back when it was recommended, you would have about $436,126 today. Meanwhile, a $1,000 investment in Nvidia made at the time of its recommendation would have grown to around $1,053,659.
It’s essential to highlight that our total average return stands at 885%, in stark contrast to the S&P 500’s 192%. This means we’re not just keeping pace with the market but substantially outpacing it.
In conclusion, before making your investment, it might be wise to explore our latest top stock picks.
