Nvidia (NASDAQ:NVDA) started off strongly on Thursday, becoming the world’s most valuable publicly traded enterprise. The record didn’t last long, though that might not be the end of the story. Microsoft (NASDAQ:MSFT) presently has a market capitalization of around $3.3 trillion, thus pipping NVDA stock and Apple (NASDAQ:AAPL), which both sit around $3.22 trillion.
Given the market’s frequent ebb and flow, the rankings of these so-called hyperscalers will likely fluctuate. However, Wall Street’s attention is now turning to a once-seemingly mythical target: the race to $4 trillion.
On paper, NVDA stock has an excellent chance of reaching the mark first. As The Street pointed out, it only took the tech juggernaut 74 trading sessions to pad its market value with another trillion, putting it above the $3 trillion level. Further, Nvidia represents the clear leader so far in the graphics processors that undergird advanced artificial intelligence (AI) protocols.
As such, Wedbush analysts remarked that Nvidia’s processors represent “in essence the new gold or oil in the tech sector.” In their view, more businesses will start embracing the burgeoning innovation, leading to more demand for Nvidia chips.
NVDA Stock Expected to Charge Ahead, but Some Concerns Exist
Wedbush experts did present some caution to the blistering narrative underlying NVDA stock, citing possible disruptions of near-term sales cycles in some tech enterprises. However, they also believe that a “massive” wave of expenditures will boost the AI sector, fueling a possible “industrial revolution” in the tech ecosystem.
“In a nutshell, we believe this tech bull market has legs that will ultimately broaden out to the rest of software, consumer tech, cyber security, semis, and infrastructure over the next 12 to 18 months,” the analysts remarked.
Specifically, Wedbush’s Dan Ives believes that “the race to $4 trillion market cap in tech will be front and center between Nvidia, Apple and Microsoft.” However, it’s possible NVDA stock may have the edge, with generative AI applications all going through Nvidia.
Still, not everyone is convinced. As Julia Angwin of The New York Times mentioned, a little over a year ago, a group of researchers asked for a hiatus in developing large-scale AI systems due to fears of uncontrollable power. Right now, “the question isn’t really whether A.I. is too smart and will take over the world. It’s whether A.I. is too stupid and unreliable to be useful,” Angwin stated.
Notably, while Nvidia has beaten its bottom-line earnings estimates in the past four quarters, the positive surprise has declined from 28.6% in Q2 fiscal 2024 to 8.9% in Q1 fiscal 2025.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
