Buy NVIDIA Stock, DeepSeek's Threat is Exaggerated

Core Viewpoint - The introduction of DeepSeek, a low-cost AI chatbot by a Chinese startup, has led to a significant decline in NVIDIA's market capitalization, but this reaction is considered overblown, presenting a buying opportunity for investors [1][2]. Group 1: Impact of DeepSeek - DeepSeek's development cost is approximately $6 million, which poses a challenge to more expensive U.S. AI models like OpenAI's Chat GPT [1]. - The sell-off of NVIDIA shares is viewed as an overreaction, as DeepSeek's model could actually increase AI usage and lower technology costs, sustaining demand for NVIDIA's chips [2]. Group 2: NVIDIA's Competitive Advantage - NVIDIA's upcoming Blackwell chips are expected to enhance performance and maintain strong demand, despite the introduction of cheaper alternatives [2][5]. - The company has a significant capital advantage due to a $500 billion investment in AI infrastructure in the U.S., which supports its competitive position [3]. Group 3: Market Demand and Financial Health - Strong demand for NVIDIA's Blackwell chips has been noted, particularly from major clients like Microsoft and Alphabet, contributing to a positive outlook for share prices [5]. - The global GPU market is projected to grow from $101.54 billion to $1,414.39 billion by 2034, indicating a robust growth trajectory for NVIDIA [6]. - NVIDIA's return on equity (ROE) stands at 120.4%, outperforming the industry average of 78.3%, showcasing its effective cost control and profitability [7]. Group 4: Investment Opportunity - The recent decline in NVIDIA's share prices offers a favorable opportunity for investors to acquire shares at a discounted rate [9]. - NVIDIA's lower debt-to-equity ratio of 12.8% compared to the industry average of 22.1% suggests reduced investment risk [9].