Nvidia's Stellar Turnaround To Propel Google, Meta, TSM, And ASML Amid Rapid AI Advancements, Says Gene Munster

NVIDIA Corp NVDA is experiencing a remarkable turnaround, and according to Deepwater Asset Management‘s Gene Munster, this success is set to have a ripple effect on other industry players.

What Happened: Munster, a former Piper Sandler analyst, highlighted Nvidia’s recent performance and its implications for the AI sector in an interview with CNBC’s Fast Money. He pointed out that Nvidia’s business, which had seen a 13% decline in the same quarter last year, has now surged by 216%.

Munster emphasized the rapid pace of change within the AI industry and identified companies like Taiwan Semiconductor Manufacturing Co. TSM, ASML Holding NV ASML, Google‘s parent company Alphabet Inc GOOGL GOOG, and Meta Platforms Inc META as well-positioned to benefit from this trend.

He forecasted significant market dynamics shifts over the next three to five years, driven by the increasing integration of AI across industries.

Highlighting investor enthusiasm for the AI wave, Munster also touched on the “Osborne effect”—a phenomenon where prematurely announcing future products leads to reduced sales of current offerings. This effect, he noted, underscores the intense competition and rapid innovation cycle within the tech industry, particularly as companies race to release ever-more powerful AI chips.

See Also: Nvidia Reports Beat-And-Raise Q1, Announces 150% Dividend Hike, 10-For-1 Stock Split

Looking ahead, Munster expressed strong confidence in Nvidia’s growth trajectory. He anticipates the company will grow at an annual rate of 35% through 2025 and 2026, citing CEO Jensen Huang's ambitious vision and strategic applications. Munster concluded that Nvidia’s growth story is far from over, positioning it as a continued leader in the AI revolution.

Why It Matters: Nvidia’s recent success has been widely noted. The company recently reported a strong first quarter, announcing a 150% dividend hike and a 10-for-1 stock split. This news led to a surge in the company’s stock, sparking a social media frenzy and further affirming its position at the center of the global AI wave.

Industry analysts have also predicted a positive future for the semiconductor industry, with JPMorgan betting on companies like Advanced Micro Devices Inc AMD, Micron Technology Inc MU, and Arm Ltd ARM to drive industry optimism and AI demand.

Nvidia stock is up 115.49% year-to-date, outperforming major ETFs such as the SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust QQQ, and the iShares Semiconductor ETF SOXX. This follows a 240% surge in 2023.

Read Next: Google Acquiring HubSpot For $31B To ‘Take Market Share From Microsoft,’ Says Expert

Image Via Pixabay

This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.