Nvidia Has More Room To Run
The January 2025 selloff in Nvidia was probably the only big opportunity to jump into Nvidia shares this year.
Macro uncertainty has reared its ugly head this year, and even that hasn’t been able to topple Nvidia shares.
The stock is now closing in on all-time highs, and it is one of the pillars of the tech stock ecosystem.
NVDA has added $1.5 trillion in market valuation in the past 2 months and almost certainly will be the first $10 trillion company.
Every earnings we approach, investors talk about how Nvidia will certainly surpass expectations.
Almost like clockwork, investors have cheered from the sidelines as the company keeps rolling out the best-of-breed products.
Many say that its CEO, Jensen Huang, is the new Steve Jobs.
Praise that lofty is unheard of lately in tech, as many of the most influential companies have avoided innovation and gone straight for the cash flow.
Nvidia’s stock plummeted nearly 17% marking the largest one-day loss in U.S. history.
This sell-off was triggered by the emergence of DeepSeek, a Chinese AI startup that unveiled a cost-effective large language model (LLM), DeepSeek-R1, developed for under $6 million using Nvidia’s less advanced H800 chips.
The model rivaled top U.S. AI models like OpenAI’s ChatGPT, sparking fears that AI development might require fewer high-end Nvidia GPUs, threatening the company’s core business.
The DeepSeek sell-off was fueled by panic over the startup’s claims of efficiency. Investors worried that if AI models could be built cheaply with less computational power, demand for Nvidia’s expensive GPUs, which cost up to $25,000 each, might wane. DeepSeek’s model, trained on older Nvidia chips, suggested a potential shift toward software-driven optimization rather than hardware-intensive brute-force computing.
Nvidia’s 2026 revenue is projected to grow 52%, fueled by demand for its Blackwell chips, which are overcoming production bottlenecks and expected to surpass Hopper chip revenue by mid-2025.
DeepSeek’s efficiency gains were reframed by tech leaders as a catalyst for faster AI evolution, not a threat to Nvidia’s hardware dominance. The Jevons Paradox—where efficiency increases demand—suggests that cheaper AI models could expand use cases, driving more GPU purchases.
As we spring into the back of 2025, it is hard to envision any type of “black swan” disrupting this runaway freight train of a business model.
The entire tech community is on board with the AI story as if it is one monolith.
There hasn’t been so much consensus in anything tech-related after the flops of VR and AR.
Instead of ignoring Nvidia and shrugging it off, readers need to add every and any dip in this name.
I don’t believe the AI story will cease to exist any time soon, and it’s only a matter of time before they take over large chunks of the real economy.
AI is coming a lot quicker than many believe, and some have never even heard about it.
As of today, entry-level jobs have been completely eliminated in most Fortune 500 companies, and AI will continue to erode jobs up the value chain, delivering more returns to the shareholders.
It would be foolish to invest in tech stocks and not have a tidy percentage of a tech portfolio in Nvidia.
I am highly bullish on Nvidia stock.
