Cryptocurrency
The Motley Fool

1 Unstoppable Stock to Buy Before It Soars More Than 400%, According to 1 Wall Street Analyst

July 8, 2025
03:31 AM
5 min read
AI Enhanced
investmenttechnologyaimarket cyclesseasonal analysismarket

Key Takeaways

Investors continue to underestimate the staying power of this industry leader.

Article Overview

Quick insights and key information

Reading Time

5 min read

Estimated completion

Category

cryptocurrency

Article classification

Published

July 8, 2025

03:31 AM

Source

The Motley Fool

Original publisher

Key Topics
investmenttechnologyaimarket cyclesseasonal analysismarket

Investors continue to underestimate the staying power of this industry leader

There's no denying that 2025 has been a tumultuous year for investors thus far, and Nvidia (NVDA -0. 74%) is a prime example

After rallying as much as 11% to kick off the year, the stock plunged 37% from its peak, before eventually climbing to new highs

Concerns inflation, the impact of tariffs, and the unresolved trade war have all contributed to the historic volatility

Nvidia has become the de facto standard-bearer for the AI revolution, and despite increasing competition, the company's chips are still the gold standard for AI cessing

In fact, since the adoption of AI kicked into high gear in early 2023, Nvidia stock has soared 990%

As a result, Nvidia is currently the world's largest publicly traded company by market cap, clocking in at $3. 86 trillion (as of this writing)

Yet there could be more to come

Nvidia could potentially become the world's first $20 trillion company, which would represent additional upside of more than 400%, according to one Wall Street analyst

Image source: Getty Images

You want chips with that

Nvidia revolutionized the game industry when it pioneered the graphics cessing unit (GPU) in 1999

What made these chips unique was the introduction of parallel cessing, which allowed them to conduct a multitude of mathematical calculations simultaneously

That enabled the chips to subdivide computationally intensive jobs into smaller, more manageable bits, thereby speeding cessing time

It turns out that those lightning-fast cessors could be brought to bear on a plethora of other computing tasks, which quickly made them the top choice for AI

Beyond its industry-leading hardware, Nvidia chips bring more to the game

Its Compute Unified Device Architecture (CUDA) gramming platform and software architecture help developers get the best performance from the GPU

Nvidia offers more than 400 libraries that help developers "build, optimize, deploy, and scale applications across PCs, workstations, the cloud, and supercomputers using the CUDA platform. " By helping developers tap the full capabilities of the GPU, Nvidia has become their first choice and the industry standard

Far beyond gaming, Nvidia's chips dominate a number of use cases for the GPU, including cloud computing, data centers, and machine learning -- an earlier branch of AI

CUDA is deeply entrenched among developers, and Nvidia remains the top choice for generative AI

The path to $20 trillion Nvidia currently boasts a market cap of roughly $3. 86 trillion, which implies stock price gains of 418% to drive its value to $20 trillion

According to Wall Street, Nvidia is poised to generate revenue of roughly $200 billion in fiscal 2026, giving it a forward price-to-sales (P/S) ratio of roughly 19

Assuming its P/S remains constant, Nvidia would need to grow its revenue to roughly $1 trillion to support a $20 trillion market cap

Wall Street is currently forecasting revenue growth for Nvidia of 21% annually over the next five years

If the company can maintain that growth rate, it could actually achieve a $20 trillion market cap as early as 2035

To be, plenty of things would have to go right for Nvidia to reach this lofty benchmark, so the potential is pretty remote

A bullish take One Wall Street analyst, however, believes chances are more than good

Philip Panaro, former Boston Consulting Group executive, said, "I believe Nvidia will hit $800 by 2030. " That works out to a market cap of just short of $20 trillion

The analyst lays out three primary factors that will help fuel Nvidia's rise to $20 trillion: AI adoption currently stands at "less than 1%," according to Panaro

A low-to-mid-single-digit penetration would ultimately drive Nvidia's value up fivefold

Panaro estimates companies will invest roughly $10 trillion between now and 2030 to adopt Web 3 -- the next iteration of the internet built on blockchain

He calculates that only $1 trillion has been spent thus far, which suggests a $9 trillion data center opportunity remains for Nvidia

Panaro believes that the Department of Government Efficiency's (DOGE) mandate to find and eliminate waste will "reinvent how government is managed and dered. " Creating "digital twins" for more than 300,000 government buildings could drive costs down "tremendously," representing another massive opportunity for Nvidia

Panaro believes these opportunities will drive the revenue growth necessary to support a $20 trillion market cap for Nvidia

A pie-in-the-sky prediction

While Panaro presents an intriguing case, I think the chances of Nvidia hitting his lofty goals are slim

That said, the company doesn't need to hit a $20 trillion market cap by 2030 for it to be a winning investment

It's also worth noting that fair-weather investors tend to bail at the first signs of trouble, making Nvidia extremely volatile

Look no further than the stock's 37% decline earlier this year or its 66% drop during the economic downturn in 2022 as evidence that in Nvidia isn't for the faint of heart

On the bright side, however, the stock is currently selling for 28 times next year's earnings (as of this writing), a compelling opportunity for a company with an opportunity of this magnitude

I'm a dyed-in-the-wool Nvidia bull

The stock accounts for 12% of my portfolio and is my second-largest position

While I believe in the long-term potential of the company, I also believe the road ahead will be a bumpy one

While Nvidia may not see a market cap of $20 trillion over the next years, the stock is still an unqualified buy

Danny Vena has positions in Nvidia

The Motley Fool has positions in and recommends Nvidia

The Motley Fool has a disclosure policy.