NVIDIA continues to trend across all investment portals due to the potency of its technology and potential earnings for investors across the globe.
Its meteoric rise, driven by artificial intelligence (AI) innovations, has made it a focal point for wealth creation discussions.
As of July 2025, NVIDIA boasts a staggering market valuation of approximately $4.2 trillion. This has cemented NVDA’s position as the world’s largest company by market value.
But is investing in NVIDIA stock a path to becoming a millionaire?
This article explores the pros and cons of investing in NVIDIA. It offers extensive insights into the company’s potential as well as risks.
Let’s delve into the specifics of why you should consider investing in this stock.
What is NVIDIA?
NVIDIA, founded in 1993 by Jensen Huang, is a powerhouse in graphics processing units (GPUs). It is headquartered in Santa Clara, California. Initially focused on gaming, it now dominates AI, data centres, and autonomous vehicles. To put it simply, NVIDIA’s Graphic Processing Units (GPUs) power cutting–edge technologies.
Its GeForce brand revolutionised gaming, while its A100 and H100 chips fuel AI advancements. In Q1 2025, NVIDIA’s revenue was $44.1 billion. The revenue was a 12% increase from Q4 and a 69% spike from the same period in 2024.
This growth reflects its pivotal role in the AI revolution. Moreover, its CUDA software creates a robust ecosystem, locking in developers. With 36,000 employees, NVIDIA drives innovation across industries. Yet, its high valuation raises questions about sustainability. Let’s explore the reasons to invest.
The Pros of Investing in NVIDIA
NVIDIA’s dominance in AI is undeniable, making it an attractive investment.
Firstly, its GPUs set the benchmark for AI training. Companies like Microsoft and OpenAI rely heavily on NVIDIA’s hardware. In Q1 2025, data centre revenue was $39.1 billion, up 10% from Q4 2024 and 73% from Q1 2024.
If this trend continues, analysts project AI could contribute up to $15.7 trillion to global Gross Domestic Product (GDP) by 2030. NVIDIA’s leadership ensures it captures a significant share.
Additionally, NVIDIA diversifies beyond AI. Its GeForce NOW service enhances cloud gaming, while its Isaac and Cosmos platforms advance robotics. These ventures tap into a $50 trillion opportunity, as estimated by CEO Jensen Huang. Consequently, NVIDIA’s revenue streams are robust and varied.
Furthermore, NVIDIA’s financial health is stellar. Its net profit margins exceed 50%, with a return on equity among tech’s best. In Q1 2026, NVIDIA reported earnings per share of $0.96 (which excludes the H20 charge and related tax impact), surpassing analysts’ estimates.
This profitability supports its high stock price. Moreover, a sizable number of financial analysts rate NVIDIA as a Buy or Strong Buy. This indicator signals strong market confidence. Institutional investors also hold significant positions, bolstering stability.
Finally, NVIDIA’s stock has a proven track record. A $1,000 investment from 2015 grew to over $868,000 by 2025. This historical performance excites growth investors. Thus, NVIDIA’s innovation and financial strength make it compelling. However, as with all investments, there are significant risks involved.
The Cons of Investing in NVIDIA
Despite its allure, NVIDIA faces significant hurdles.
Firstly, NVIDIA’s valuation is extremely high. NVIDIA’s stock is priced at a premium, with a trailing P/E ratio of 55 (stock price of $173 divided by earnings per share of $3.10 as of April 30, 2025). This high multiple leaves little room for error. If growth slows, the stock could plummet. For instance, early 2025 saw NVIDIA’s valuation drop due to concerns over cheaper AI chips.
Moreover, competition is intensifying. Rivals like AMD and Intel are developing advanced AI chips. In China, Huawei aims to capture market share with homegrown solutions. Additionally, major clients like OpenAI are designing custom chips, reducing reliance on NVIDIA. This shift threatens NVIDIA’s dominance.
Regulatory challenges also pose risks. The Trump administration’s restrictions on chip exports to China led to a $4.5 billion impairment charge in 2025. Chinese regulators further discourage NVIDIA’s H20 chip sales, citing efficiency issues. These geopolitical tensions could disrupt revenue. Similarly, potential U.S. tariffs or Chinese import bans could hurt profitability.
Furthermore, NVIDIA’s stock is volatile. In 2025, it dropped nearly 30% amid tariff fears and cooling AI demand. Its high beta means sharp price swings. Investors seeking stability may hesitate.
Lastly, NVIDIA’s dividend yield, under 0.05%, offers little income. Growth-focused investors may overlook this, but it limits appeal for income seekers. These risks demand careful consideration.
How to Invest in NVIDIA
Investing in NVIDIA is straightforward but requires strategy. Open a brokerage account. Platforms like SoFi and Public.com provide commission-free trading options.
That said, eToro is another platform you can consider for your NVDA needs. You can create an eToro account, go through the Know Your Client (KYC) phase, deposit funds, and then search for and purchase NDVA stock.
Please take a moment to review their fees and tools before making your decision. NVIDIA trades on NASDAQ under the ticker NVDA, with a share price of $173.50 as of July 28, 2025.
Next, decide your investment approach. Dollar-cost averaging mitigates risk by distributing investments across regular intervals.
Alternatively, buy during dips, as NVIDIA’s stock has shown resilience. For example, its 52-week price range extends from $86.62 to $174.72. Timing entries near support levels, like $150, can optimise returns.
Additionally, consider diversification. NVIDIA’s volatility makes it risky as a sole holding. Pair it with index funds tracking the S&P 500 for balance. Also, set a stop-loss to limit your losses. Analysts suggest $167.37 as a stop-loss level, a 3.53% drop from current prices.
Finally, stay informed. Track NVIDIA’s earnings, with the next report scheduled for August 27, 2025. Monitor AI trends and geopolitical developments.
Resources like Yahoo Finance and Investing.com provide real-time updates. By blending research and discipline, you, as an investor, can navigate NVIDIA’s potential.
Conclusion: So, Is NVDA a Good Investment?
NVIDIA’s position as a $4.2 trillion titan makes it a compelling choice. Its leadership in AI, robust financials, and diverse applications drive optimism. NVIDIA is well-positioned, with 88% of its revenue coming from data centres and projected growth in the AI market.
Its historical returns—$1,000 growing to $868,615 in 20 years—highlight its potential. Analyst backing, with an average price target of $179.75, boosts confidence.
However, risks cannot be ignored. High valuations, competition, and regulatory hurdles create uncertainty. The stock’s volatility and low dividend yield may deter conservative investors.
Thus, NVIDIA suits those comfortable with risk and a long-term horizon. Diversifying and timing entries can mitigate downsides.
Ultimately, NVIDIA’s innovation and market dominance make it a strong contender. Yet, investors must weigh its premium valuation against potential rewards. For growth-focused portfolios, NVIDIA remains a top pick, but caution is key.
Will NVDA Be a Millionaire-Maker Stock?
Can NVIDIA turn investors into millionaires? Historically, it has. In January 2020, a $100,000 investment in NVDA, which traded for $5 per share at that time, allowed the purchase of 20,000 shares. In January 2024, NVDA surpassed the $50 price milestone. The achievement meant that investors with 20,000 shares multiplied their holdings by $50 and came to a realisation of $1 million. So, yes, NVIDIA has demonstrated over time that it is a millionaire-maker stock.
However, replicating this success is tougher now. NVIDIA’s $4.2 trillion market cap limits explosive growth. Significant capital is required to achieve millionaire status. For example, a $100,000 investment at $173.50 per share buys 576 shares. Analysts predict a $1,000 share price by 2030, yielding $576,000—a strong return, but not millionaire-making for most.
Moreover, competition and regulatory risks could cap gains. Cheaper AI chips and custom designs threaten margins. Yet, NVIDIA’s moat—its CUDA ecosystem and 78% GPU market share—offers resilience. The AI market’s projected $15.7 trillion contribution to global GDP by 2030 supports long-term upside.
In conclusion, NVIDIA is unlikely to be a traditional millionaire-maker due to its current price. Still, its growth trajectory suggests solid returns. Investors with patience and diversified portfolios may find NVIDIA a valuable asset.
If you aspire to become a millionaire, considering combining NVDA with other high-growth stocks could significantly improve your investment portfolio.
