Think Nvidia Stock Is Expensive? This Chart Might Change Your Mind.

Nvidia (NASDAQ: NVDA) was one of the best-performing stocks of 2024. It even dwarfed the returns of the Nasdaq Composite index in a year the index itself returned an amazing 28.6%. Its stock price soared as the market became enthused by consistent triple-digit revenue gains that led to triple-digit net income gains. That led to a 171% increase in Nvidia's stock price in 2024. It also pushed the stock's price-to-sales ratio to 30.Those who might think that means the stock is now too expensive should look at the opportunity still ahead. Enough opportunity can trump a high P/S. One chart might help explain.Big tech companies continue to ramp up spending to build artificial intelligence (AI) infrastructure. Microsoft and Amazon each recently announced commitments to invest $80 billion and $11 billion, respectively, in the coming months. The investments are for data centers to train AI models, and distribute AI and cloud-based applications. That's because the market for generative AI is expected to grow tenfold over the remainder of the decade.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool