Key Points
Nvidia (NASDAQ: NVDA) has been a major beneficiary of the rising investment in artificial intelligence (AI) infrastructure, contributing to the growth of the U.S. economy. Over the past 12 months, Nvidia shares have produced a total return of 30%, and a $1,000 investment made a year ago would now be worth $1,300. In comparison, the S&P 500 returned only 14% during the same period.
In terms of earnings, Nvidia’s net income grew by 644% from fiscal 2022 to fiscal 2025 (ending January 26, 2025), with a current forward price-to-earnings ratio of 23, making the stock attractive to potential investors. However, concerns over an AI market bubble could pose short-term risks to Nvidia’s share price.
