‘Don't Be a Fool,' Says Top Investor About Nvidia Stock

Business Insider

26-06-2025

Nvidia (NASDAQ:NVDA) holds a stunning advantage in the AI race, riding its world-beating GPU chips to unbelievable heights. The company controls some 90% of the lucrative data center market, and its newest Blackwell chips are selling like hotcakes.
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For such a large company, its revenues are still growing strong – 69% last quarter – and despite a one-time $4.5 billion hit due to China restrictions, margins were still above 60%.
That resilience has helped turn the tide. While trade tensions and fears of slowing capex spending among the hyperscalers placed some pressure on the company's share price earlier this year, those concerns now appear to be fading fast. NVDA stock is up over 60% since its post-Liberation Day dip in early April – and just today, it notched a new all-time high.
Even so, Nvidia isn't out of the woods. Its dominance has made it a target, and rivals are scrambling to catch up. Whether through competing GPUs or emerging photonic and analog in-memory solutions, challengers are actively trying to erode Nvidia's edge. The question looming over the stock is this: Could these alternatives finally knock the giant off its perch?
Not likely, says top investor James Foord, who is among the top 2% of TipRanks' stock pros. He believes that Nvidia has a 'secret weapon' up its sleeve – one that will help the company maintain its lead in the AI hardware race for years to come.
'Nvidia Corporation's dominance stems from its integrated AI stack and robust software ecosystem, not just its GPUs,' reminds Foord.
In particular, the company's decision to open its CUDA software and NVLink Fusion interconnect to third parties – including Qualcomm and Marvell – could be transformative. This strategic shift, according to Foord, enables Nvidia to become the backbone of the broader AI ecosystem, embedding itself deeply across multiple platforms. The investor likens this to Microsoft's playbook with Windows. Just as becoming the default operating system cemented Microsoft's place atop the computing world, Nvidia could be positioning itself as the de facto OS for AI.
'Creating the dominant OS for computers secured revenues for the company for decades to come, even without the need to succeed in the hardware market,' adds Foord.
While the investor concedes that Nvidia's hardware edge may be narrowing, he argues, 'it would be even more foolish not to acknowledge Nvidia still has a stronghold on the market.'
As the hardware race heats up, Foord thinks investors might be missing what could be the real prize: AI software. That's where he sees the next big wave of growth and profit – and why he remains firmly bullish on NVDA stock, giving it a Strong Buy rating. (To watch Foord's track record, click here)
That's the overall spirit on Wall Street as well. With 35 Buy, 4 Hold, and 1 Sell ratings, NVDA has a Strong Buy consensus rating. Its 12-month average price target of $175.28 has an upside of ~14%. (See NVDA stock forecast)
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