$NVDA · The Motley Fool · 2026-10-26

the first stock I think is at interesting levels with the recent pullback is Nvidia. I mean, this is still a $5 trillion company, which is a surprise, isn't it, Neil?

We have already heard from Jensen that in the next fiscal year they can achieve growth of more than 70% year-on-year. This will bring their revenue close to $400 billion, which is insane.

They stated that if they were able to improve or expand their supply chain, this figure could be much higher. The only reason they are not growing is simply problems with supply constraints.

Obviously, when you work with these kinds of numbers, you need to build new factories and new infrastructure for the supply chain itself. So, recently we had the GTC conference in Berlin.

Nvidia stated that it is working with more suppliers to increase production capacity. Therefore, I think the 70% figure will be slightly higher. With a company trading at forward earnings ratios of around 19 or 20 times, and for someone who is very optimistic about artificial intelligence and believes this cycle will last much longer than the market expects, I think Nvidia is one of those stocks that has attractive valuations right now.

Also, the fact that SpaceX exclusively uses Nvidia graphics processing units means that any money SpaceX spends, you know that the majority of it will go to only one specific player.

We've already got some big numbers by now. Whether these figures are real or not is still a matter of time, but even if it's roughly 50% of that $500 billion, it's still a good amount going to Nvidia for one specific name.

Now, I agree with you that Nvidia is very cheap at the moment. I mean, it's a company that is still expected to grow by more than 90% or close to it this year. Next year they set a minimum of 70%, which they may exceed based on feedback, and perhaps they will.

It's not as if they're only making $10 billion in revenue. They are already generating hundreds of billions of dollars in revenue. They are also expected to generate hundreds of billions of dollars in free cash flow.

So, the question now is, will it remain cheap for a long period of time? Because the market simply doesn't mind keeping it at the $5 trillion level. dollar. To move a $5 trillion stock, you would need a lot of buying activity to raise it to $6 or $7 trillion or more.

But hold on, in the meantime, this is a very profitable company, increasing dividends, increasing share buybacks, and it's still number one when you look at market share in the entire AI field.

Therefore, it is very attractive. I understand why it's the biggest company on the planet, because it simply generates so much revenue, and to continue growing at this size as if it were a small startup is truly amazing.

I think the biggest question the market is asking is: Can this be sustainable in the foreseeable future? Can they maintain this level of profit margins five years from now? Maybe yes, maybe no. Even if it were slightly less, but the dollar amount would be much larger, it would still be a very cheap name.

Also, the fact that they are now ensuring the increased popularity of open-source models will be a very positive thing for Nvidia and for every cloud technology that provides Nvidia's graphics processing units.

Because assuming that OpenAI and Anthropic are unable to fulfill all of their commitments, the need for computing and the need for artificial intelligence will not disappear. It will only transfer from one player to another.

If the other side, which in this case is Nvidia, and the open model that runs on Nvidia's hardware and software, are the winners, then Nvidia certainly won't disappear anytime soon.

We're not even talking about self-driving vehicles, robots, and everything that's going to happen over the next two years.

During the GTC conference in Berlin, Nvidia launched something truly remarkable, Neo. It was called the DGX Pod. They have had systems like this before, but this is the first time we have seen something resembling a shipping container that actually contains a pre-built Vera Rubin system solution inside it.

So, you can come, and they said they can reduce the time needed to get computing power after the data center is built from a few months to just 14 days. This is crazy.

If you really want our money, I feel more comfortable dealing with Nvidia." "Because I know that the revenue will start to be collected much faster, and therefore you will be able to pay me back much faster as well."

But I think that's also why we're seeing Nvidia playing the circular financing game.

blueprints, as I mentioned regarding DX X, to help you build data centers. And recently at the GTC conference in Berlin, we saw something resembling a DGX-Pod. This increases the chances of success and reduces many of the implementation risks.

Now, Nvidia is the one who will take your hand. I believe that with the implementation risks reduced slightly, any new data center has a greater chance of success , a greater chance of operation, and a much faster start generating revenue.