There’s no getting around it. Top AI stocks like Nvidia (NASDAQ:NVDA) have lost momentum. However, the market’s sudden worrying about “what’s next” for big AI winners like Nvidia stock may end up being an advantageous turn of events, for investors entering or adding to positions right now.
Even as a growing number of market participants have been thinking that this AI chip designer’s shares have finally topped out, that may prove to ultimately not be the case. In fact, the next big run-up for shares could be just around the corner.
The market may think “what’s next,” but this early-mover in this fast-growing segment of tech continues to charge ahead, with efforts to level up on its success thus far. With this, while the weakness still lasts, you may want to seize the opportunity, as we’ll explain below.
Nvidia Stock: On the Verge of a Pre-Earnings Rebound?
As recently discussed, two key factors have weighed on shares over the past few weeks. First, there has been increased concern about a slowdown in demand for AI chips. Second, as rival semiconductor companies ramp up their efforts to capitalize on the generative artificial intelligence trend.
There have also been concerns that this too will negatively affect Nvidia’s growth going forward. In the same article, we argued these worries could prove overblown, once the company next releases earnings on May 22. However, considering more recent developments, a rebound for Nvidia stock could arrive far sooner.
Fear and uncertainty about sector demand has started to wane. Earnings reports from Nvidia’s top customers signal end-user demand will stay robust. Other news signals that Nvidia isn’t just resting on its laurels. On April 25, the company announced plans to acquire two Israeli AI startups.
These acquisitions may produce growth synergies for the overall company. In addition, Nvidia CEO Jensen Huang, in an interview on 60 Minutes last Sunday, discussed how there could be mass adoption of AI technology in sectors besides tech.
Still, Stay Focused on the Long-Term Bull Case
A rapid rebound for Nvidia stock will obviously be a fantastic scenario for anyone who dived into NVDA at or near its all-time high of $974 per share. However, no matter whether you got in at the high-water mark, or have held this AI winner for quite some time, keep in mind a big caveat that could accompany a pre-earnings rally.
If NVDA keeps climbing back in the lead-up to earnings, the likelihood of a post-earnings pullback may be creeping back higher as well. Despite Nvidia’s strong earnings and guidance, the market may focus on one negative aspect.
This, in turn, could lead to shares selling off after the earnings news. Still, while a post-earnings rally would be nice, the focus here should remain on the long-term bull case. NVDA is expected to surge sixfold, with no signs of slowing down.
At least, that’s what suggested by the prospect of Nvidia staying dominant in AI chips, which gives credence to the top end of earnings forecasts for fiscal year ending January 2026, which call for annual earnings to come in as high as $46.37 per share.
Bottom Line: Lock Down Before a Possible Bounce Back
It’s not set in stone that Nvidia sinks like a stone after next month’s earnings release. If other tech earnings releases elicit a positive reaction from investors, chances are the same will play out with NVDA.
With this, shares may not only keep climbing ahead of earnings, but also leap to even loftier price levels throughout the summer. Shares are reasonably-priced at around $875 per share.
If subsequent results indicate Nvidia will meet or beat the above 2026 forecast, a move to $1,250 or even $1,500 per share in 2025 is well-within the realm of possibility. Considering this substantial upside potential, we reiterate our view that Nvidia stock is a buy at current prices.
Nvidia stock earns an A rating in Portfolio Grader.
— Louis Navellier and the Investor Place Research Staff
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Source: Investor Place