Worried About Nvidia's Expensive Valuation? 1 Artificial Intelligence (AI) Stock to Buy Hand Over Fist While It's Still Cheap.
The booming popularity of artificial intelligence (AI) gave Nvidia (NASDAQ: NVDA) a massive lift so far in 2023, with shares of the semiconductor giant trading up more than 240%, but this also means that the stock is richly valued right now.
Nvidia now trades at 120 times trailing earnings, and it has a price-to-sales ratio of 37. This clearly makes Nvidia an expensive bet for investors looking to cash in on the AI boom. Of course, Nvidia seems capable of justifying its expensive valuation, as its latest quarterly results, which were released on Aug. 23, indicate.
The chipmaker's revenue in the second quarter of fiscal 2024 (for the three months ended July 30, 2023) doubled year over year to $13.5 billion. Its adjusted earnings shot up 429% to $2.70 per share. Even better, Nvidia expects its revenue growth to accelerate in the current quarter. Its revenue guidance of $16 billion points toward a 171% year-over-year jump, indicating that growth investors looking for a top AI stock can still consider buying it given its eye-popping growth.
Source Fool.com
