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Nvidia Underperformed in November—Is This a Golden Buying Opportunity?
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Nvidia (NASDAQ:NVDA) stock was pretty flat for the month of November, rising close to 2%, while most other mega-cap tech titans took off on the back of Donald Trump’s presidential win. Undoubtedly, a 2% gain for any stock isn’t all that bad. Of course, when you start comparing to the peer group, it becomes more apparent that Nvidia shares are starting to look like a fast car that’s starting to run out of gas. Undoubtedly, there’s a lot to look forward to in the new year as AI software developers look to monetize the technology to justify all that hardware spend.
And while many companies, such as Amazon (NASDAQ:AMZN), have ambitious plans to keep advancing their own AI accelerators to reduce their reliance on Nvidia GPUs, I’d argue they’re still many miles behind in catching up to Jensen Huang and company.
As such, Amazon’s latest hardware reveal, I believe, shouldn’t be all too concerning for Nvidia shareholders, especially as the next generation of Nvidia chips (Blackwell and Rubin) looks to spark another gold rush of sorts.
Key Points About This Article
- Nvidia’s latest November slump seems more like an opportunity than a red flag.
- It’s tough to tell where AI goes from here. A bull case may just mint Nvidia as the first $4 trillion firm.
- If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.
The AI revolution not be done with Nvidia stock
In any case, there are a lot of catalysts in the tanks that could help refuel NVDA stock in 2025. And, of course, there’s always a possibility that investors are still underestimating the potential AI market as AI agents and more custom-tailored large language models (LLMs) unlock value at the enterprise level. Just look at the AI software stock and how they’ve been doing over the past month!
It’s really hard to tell if the pace of AI advancement is poised to continue, accelerate, or slow down going into 2025. Ultimately, it’ll be the performance of top AI software companies, like Salesforce (NYSE:CRM), which recently clocked in exceptional quarterly results, that will act as a thermometer for the AI trade.
Currently, there are no major signs that AI is about to peter out or pull back. Not while Salesforce and other AI software titans look to AI agents to lead the AI scene higher in the new year. Further, OpenAI’s Sam Altman is convinced that the world is about to face profound disruption from the likes of AI “superintelligence,” which may be achieved within a few thousand days.
Could AI chip demand pick up further?
Altman’s words are not to be taken lightly. If such a superintelligence is really on the horizon, the implications for corporate America could be profound. And with many investors overly concerned about valuations of the AI trade and returns on investment (ROI), perhaps many stand to miss the forest for the trees, underestimating the disruptive growth to be had from AI’s top juggernauts.
Of course, AI’s next move will be difficult to predict. Perhaps AI could hit a block over the medium term, making an AI superintelligence farther off than expected. Either way, there is a risk of missing out on the upside, I believe, from bailing out too early on the AI trade and the premier names within the Magnificent Seven cohort.
That includes Nvidia, which still seems like a solid long-term buy if we’ve only scratched the surface of what AI can do. Perhaps AI could go from becoming a fun image and poem generator to something that’s more akin to a white-collar worker at a major corporation. In any case, one thing is for sure: it will be a wild ride as the AI revolution moves forward.
The bottom line
Personally, I think Nvidia’s November slump is more of a buying opportunity than anything else, as it looks to become the first company to hit a $4 trillion market cap.
As AI agents look to roll up their sleeves and do work that makes the enterprise some big money, perhaps any dips or periods of consolidation in NVDA stock are to be viewed as opportunities to add to a longer-term position. Sure, NVDA stock could always plunge into a bear market, but there’s also a chance another explosive rally causes limit orders to never see the light of day.
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