The Evidence Is Piling Up: Should You Buy Nvidia Before 2026?

Core Viewpoint - Nvidia is positioned as a top stock to own heading into 2026 due to its significant growth, strong market position, and attractive valuation [1][11]. Group 1: Growth Potential - Nvidia's revenue increased by 62% last quarter, reaching $57 billion, with revenue more than tripling over the past two years and nearly increasing tenfold in the past three years [2]. - Approximately 90% of Nvidia's revenue is derived from its data center segment, which is crucial for training large language models and running AI inference [3]. - The data center networking portfolio has seen a remarkable growth of 162% last quarter, generating $8.2 billion in revenue [3]. Group 2: Market Position - Nvidia has established a wide moat around its chips, primarily through its CUDA software platform, which has been widely adopted in universities and research labs for AI development [7]. - The company has captured approximately 90% market share in the GPU data center space, aided by its proprietary interconnect system, NvLink, which enhances chip performance [8]. - While custom AI ASICs are gaining traction, Nvidia's general-purpose GPUs offer flexibility that is advantageous in a rapidly changing tech landscape [9]. Group 3: Valuation - Despite Nvidia's substantial growth and strong future prospects, the stock is trading at a forward price-to-earnings (P/E) ratio of under 24 times 2026 analyst estimates and a price/earnings-to-growth (PEG) ratio of less than 0.7 times, indicating it is relatively undervalued [10].