Why Nvidia Still Looks Like A Bargain At A $4 Trillion Market Cap

There's little doubt that Nvidia NVDA is the stock of the decade so far, and as it hit a $4 trillion valuation, there remains plenty of optimism for further sustained growth. 

Nvidia was up 17.65% in the first half of 2025 amid challenging economic conditions for many Wall Street tech firms amid President Trump's bold strategy on reciprocal tariffs. 

However, the chipmaker has been buoyed by the gains made by its products in training leading artificial intelligence models, which has fueled global demand. 

This has been a recurring theme for Nvidia amid the ongoing AI boom. Between the beginning of 2020 and the end of H1 2025, NVDA has rallied an astonishing 2,500% and is now the world's largest stock by market capitalization. 

With Nvidia becoming the world's first company with a $4 trillion valuation, it's impressive that some of Wall Street's leading analysts are expecting further growth in the not-too-distant future. 

According to veteran Wall Street fund manager Chris Versace, the stock remains in a strong position to continue growing. Recently, Versace raised its price target for NVDA from $175 to $185. 

NVDA at $185 would mean an astronomical market cap of $4.6 trillion, but is further growth really inevitable for a company that's already rallied to seismic proportions off the back of the AI boom? 

World-Leading Innovation

Nvidia's strength stems from its innovation pipeline, which has helped the chip giant to become an essential component of the global adoption of artificial intelligence infrastructure. 

With UNCTAD suggesting that the global AI market will reach a value of $4.8 trillion by 2033, it's clear that the emergence of artificial intelligence and GenAI systems will be a driving force for future growth among Nvidia, as well as other chip makers. 

Crucially, the global server market rallied to almost $100 billion in Q1 2025 as more companies build their AI infrastructure, with Arm-powered server shipments rising 70%. Nvidia's market dominance in this field has seen its GB200 NVL72 rack-scale solution, based on its Grace Blackwell platform, take the lion's share of orders among firms. 

In total, server purchases grew to $95.2 billion in the first quarter of the year, reflecting a 134.1% rise over the same period in 2024. 

"Nvidia's strong position as a leading chip maker as artificial intelligence adoption continues to accelerate has been underlined in its first-quarter performance, in which the company reported revenues of $26 billion, which represents growth of 18% from Q4 2024 and 262% from the same period last year," explained Steve Frauzel, head of market insights at Just2Trade, a global brokerage brand.

"At the heart of Nvidia's future prospects is its game-changing Blackwell supercomputer that's already attracting interest among nations like the United Arab Emirates to support its development of data centres."

Trade Uncertainty Lingers

Despite high demand, some uncertainty may impact the performance of Nvidia in 2025 as the Trump administration's reciprocal tariffs continue to impact the long-term prospects of companies with an international focus. 

CEO Jensen Huang suggested that being blocked from Chinese markets would be a ‘tremendous loss' for Nvidia, and the chip maker has already written off $5.5 billion after the Trump administration said the company would need a license to sell its H20 chips overseas. 

To make matters more challenging, there appear to be no guarantees that Nvidia will be granted the license. 

This suggests that Nvidia's prospects for H2 2025 and beyond may be influenced by the outcome of trade negotiations between the United States and China, in particular. While a return of the alarming 145% tariffs we briefly saw in April remains unlikely, any escalation in trade tensions could hinder Nvidia's growth prospects. 

Insider Cash Outs Offer an Opportunity

Nvidia has been subject to growing insider sell-offs in recent months, with over $1 billion worth of stock sold in the past year and more than 50% of the cash-outs arriving throughout June. 

While insider cash-outs can be a bearish signal for investors, An FT report noted that all sales created by Huang were part of a trading plan agreed upon in March, which was triggered in June at a prearranged price. 

At an estimated price-to-earnings (P/E) of 50.0, these sell-offs appear to be profit-taking as opposed to something more sinister for investors and could present a timely window of opportunity for investors to purchase the stock at a discounted price. 

With both artificial intelligence adoption and the demand for data centers only continuing to gather momentum, it's clear that there's likely to be plenty more room to run for Nvidia over the months ahead. 

Although some volatility could emerge as a result of Trump's strategy on tariffs, Nvidia's strong market position could see the company consolidate its position as the world's most valuable stock for some time. 

Disclosure: On the date of publication, Dmytro Spilka did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer. Dmytro Spilka does not intend to make a trade in any of the securities mentioned above in the next 72 hours.