March's Most Compelling Artificial Intelligence (AI) Stock Pick

Investing in artificial intelligence (AI) is still one of the best ways to invest in high-growth companies. Additionally, AI spending isn’t even close to being maxed out yet, which leaves the door open for even more growth.

The company that’s benefiting from this more than any other is Nvidia (NVDA 0.23%). Nvidia’s GPUs are the most in-demand computing chips in the world, which is powering Nvidia’s unbelievable growth.

I think this makes Nvidia the most compelling stock to buy during March, and investors should consider loading up on it while it’s still reasonably priced.

Image source: Getty Images.

Nvidia’s growth is going to continue

Nvidia recently held its annual GPU technology conference, and CEO Jensen Huang announced several new products and capabilities. However, the most incredible part of this event was when Nvidia announced that cumulative orders for Blackwell and Vera Rubin GPUs should reach $1 trillion by the end of 2027. Last year, it thought this opportunity would reach $500 billion.

Clearly, there’s huge growth still on tap for Nvidia next year, which is why investors should be racing to buy the stock.

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NASDAQ: NVDA

Nvidia

Today’s Change

(-0.23%) $-0.40

Current Price

$175.25

Key Data Points

Market Cap

$4.3T

Day’s Range

$173.98 - $176.16

52wk Range

$86.62 - $212.19

Volume

69M

Avg Vol

175M

Gross Margin

71.07%

Dividend Yield

0.02%

Right now, the stock trades for just 21.5 times forward earnings and 36.4 times trailing earnings. For reference, the **S&P 500 **(^GSPC +0.06%) trades at 24.1 times trailing earnings and 21.2 times forward earnings. So what does all that mean?

NVDA PE Ratio (Forward) data by YCharts

The market is essentially pricing Nvidia’s stock as if it’s going to have a strong year of growth this year but 2027 will be a year of market-matching growth. However, thanks to Huang’s insights into its future, we know this isn’t the case.

Right now, Wall Street analysts expect its revenue to grow to $369 billion this year – 71% growth. Next year, they expect 29% revenue growth. Furthermore, with Huang telling us that $1 trillion in cumulative revenue from these two computing systems is likely, the 29% growth rate could be a massive undershoot. That doesn’t sound like a company that’s going to put up market-matching growth numbers, which shows me that the stock is undervalued if you have a multiyear investing horizon.

Nvidia is an excellent stock to buy right now, especially with overall negative market sentiment and AI investment fatigue. The reality is that data center build-outs are going to continue from the AI hyperscalers, and Nvidia is a direct beneficiary of that. Nvidia is still a top stock to buy and hold, and with historical valuation trends indicating that Nvidia’s stock should be priced at a higher multiple, now is the perfect time to scoop up shares.