Should investors buy NVIDIA stock?

NVIDIA, a powerhouse in the artificial intelligence (AI) industry, will announce its earnings on May 22. Given its influential position, the upcoming report has the potential to significantly impact the entire AI market in the coming days and weeks. We will thoroughly examine the crucial indicators and analyze the specific performance metrics that NVIDIA must achieve to surpass market expectations.

Since early last year, the adoption of AI has exploded, driven by Nvidia’s graphics processing units (GPUs). The stock has skyrocketed an incredible 548% since the beginning of last year (as of this writing), propelled by strong and increasing demand for AI. Nvidia has been the unofficial standard-bearer of the AI revolution, but investors are now questioning whether the trend can sustain its recent rapid pace. With this backdrop, investors should seriously consider buying Nvidia stock before its highly anticipated first-quarter report.

How you answer this question depends on what type of investor you are. For those looking to buy ownership in a business with a strong track record of execution, savvy management, and technological tailwinds, and have plans to hold it for the long term, then Nvidia might just be the stock for you.

That said, Nvidia has shown a knack for skating to where the puck is going rather than where it’s been. The company continues to spend heavily on research and development, which amounted to 20% of its 2023 revenue. Nvidia is already working on the next generation of industry-leading AI processors, which is how it stays so far ahead of the competition.

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