The good long-term outlook and reasonable valuations make NVDA stock a Buy in my view. In terms of valuations, NVDA's forward P/E multiple has also more than halved from its peak. NVIDIA will be a more profitable company with a more balanced sales mix by market in 10 years' time based on my analysis.
As such, I choose to focus on NVIDIA's long-term outlook (as opposed to its medium-term prospects), or more specifically where the company will be in the next decade, in my current article. Given that no one knows how long the current bear market will last and that a recession seems to be the base case scenario for most investors, it is critical to extend one's investment time horizon.
In my prior update for NVDA written on March 28, 2022, I touched on NVIDIA's growth prospects in the intermediate-term or the next five years, by making reference to metrics disclosed by NVDA at the March 2022 Investor Day and the sell-side's consensus financial projections for the company. The company's partnership with almost all major cloud service providers (CSPs) and server vendors is a key catalyst.I upgrade my rating for NVIDIA Corporation's ( NASDAQ: NVDA) stock from a Hold to a Buy.
The company's GPU platforms are playing a major role in developing multi-billion-dollar end-markets like robotics and self-driving vehicles.NVIDIA is a dominant name in the Data Center, professional visualization and gaming markets where Intel and Advanced Micro Devices are playing a catch-up role.
Over the years, the company's focus has evolved from PC graphics to artificial intelligence (AI) based solutions that now support high performance computing (HPC), gaming and virtual reality (VR) platforms.NVIDIA's GPU success can be attributed to its parallel processing capabilities supported by thousands of computing cores, which are necessary to run deep learning algorithms. NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU.
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