Nvidia Stock Is Up 149% This Year. Here Are 2 Stocks That Could Outperform It the Rest of 2024.
Nvidia (NASDAQ: NVDA) has been one of the best stocks to own in the artificial intelligence (AI) race so far. The company's revenue has tripled year over year in recent quarters, sending the stock up 149% in the first half of 2024.
At these lofty share prices, Nvidia's valuation looks stretched. The stock's forward price-to-earnings ratio was less than 30 to start the year, but it now trades at a more expensive 45 times this year's consensus earnings estimate. Nvidia might experience enough growth to push the stock higher, but there's also a chance that near-term demand is already baked into the share price, which could limit the stock's gains through the end of the year.
The good news is that Nvidia isn't the only AI stock beating the market. Nvidia has benefited from tight supply of AI chips, but as supply improves, it could drive more demand for AI servers, and the stocks of these companies trade at more reasonable valuations, which could set up superior returns in the near term.
Source Fool.com
