Nvidia (NVDA) shares are inching down this morning even though the chipmaker reported a solid Q2 and said artificial intelligence (AI) infrastructure could hit as much as $4 trillion by 2030.
Investors are choosing caution in buying NVDA at current levels mostly because of three reasons:
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Q2 data center revenue came in a bit shy of estimates
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Future guidance wasn’t strong enough for some
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NVDA stock is already trading at a premium valuation
However, the post-earnings pullback may be an opportunity for long-term investors to initiate or expand their positions in Nvidia stock, which is still up roughly 108% versus its year-to-date low.
According to Ben Reitzes, a renowned tech industry expert, NVDA stock could even “double from here, if not more” over the longer term.
His optimism hinges on the company’s dominant AI ecosystem and developer base, which he likened to Apple’s (AAPL) App Store advantage.
“You win the developers, you win the race,” Reitzes told CNBC in an interview today, adding the company’s platform is the most monetizable for AI applications, giving it a durable competitive edge.
On “Squawk Box,” the head of tech research at Melius also said Nvidia’s total addressable market (TAM) will surpass a whopping $600 billion by the end of this decade.
Ben Reitzes recommends sticking with Nvidia shares for the long term as sovereign AI initiatives in Europe and Middle East will meaningfully benefit the semiconductor giant as well.
On China, he remains cautiously optimistic, believing geopolitical tensions will ease and unlock significant further upside in NVDA shares moving forward.
“We’d be buyers on weakness,” the Melius expert concluded on CNBC.
According to him, Nvidia will likely see even stronger momentum in its fiscal Q4 since “we’re all systems go.”
Wall Street analysts are also keeping positive on Nvidia stock after its blockbuster Q2 earnings.
The consensus rating on NVDA shares remains at “Strong Buy” with price targets going as high as $250, indicating potential upside of another 40% from current levels.
