Investing in the stock market can be a daunting task, but buying and holding great companies for a very long time has proven to be a successful strategy for making money. Take Nvidia (NASDAQ: NVDA) for example, where an investment of $10,000 a decade ago is now worth a staggering $1.9 million. This translates to an annual return of almost 70% over the past 10 years, showcasing the power of long-term investing.
While seeing a stock jump 100x is rare, if you have extra cash after taking care of your financial responsibilities, investing in undervalued stocks with long-term potential could be a wise move. This not only allows you to benefit from compounding and growth opportunities but also helps in building a diversified portfolio.
Nvidia, despite its impressive gains, is considered undervalued based on its potential growth prospects. With a forward P/E ratio lower than its five-year average and a favorable PEG ratio, the stock presents a compelling opportunity for investors looking to capitalize on its future growth.
The company’s focus on artificial intelligence (AI) has been a key driver of its recent success, with revenue and earnings showing significant growth. Analysts are optimistic about Nvidia’s long-term prospects, particularly in the data center market where the company is expected to see substantial revenue growth in the coming years.
With Nvidia leading the AI chip market and expanding into new areas such as digital twins and AI PCs, there is a strong possibility that the company will continue to deliver impressive results in the future. This presents an opportunity for investors to potentially become millionaires by investing in Nvidia while it remains undervalued.
Before making any investment decisions, it’s important to do thorough research and consider all factors. The Motley Fool Stock Advisor team has identified 10 stocks they believe could produce significant returns in the coming years, so it may be worth exploring their recommendations before making any investment in Nvidia or any other stock.
