Nvidia’s (NVDA) stock has been under pressure this year due to various factors, including trade wars, competition in AI accelerator chips, and export restrictions on its processors. However, the company’s latest quarterly results show it continues to grow nicely.
The data center business drove Nvidia’s impressive results, growing 73% year-over-year and accounting for 89% of its top line. This segment is expected to benefit from global investment in AI infrastructure, which is projected to hit $7 trillion by 2030. According to a McKinsey forecast, nearly three-fourths of this investment will go towards data centers.
Nvidia’s dominant presence in the PC GPU market and growing adoption in the automotive sector also contribute to its growth prospects. The company’s partnerships with clients for self-driving features in the automotive industry are expected to drive revenue growth.
Analysts’ consensus estimates predict Nvidia’s earnings will increase by 43% in the current fiscal year, followed by healthy double-digit percentage gains over the next couple of years. Even if the company’s growth rate slows down, its earnings could hit $9.50 per share after five years, representing a potential gain of 73% from current levels.
Despite trading at a discounted forward earnings multiple of 25 in five years, Nvidia’s stock has significant upside potential. With elevated growth rates and a growing demand for AI hardware, this AI stock is worth buying and holding for the long run.
Source: https://www.fool.com/investing/2025/06/07/where-will-nvidia-stock-be-in-5-years