NVDA - Call Me Crazy: I'd Invest in McDonald's Over Nvidia
2024-03-23 09:06:00 ET
Graphics-chip maker Nvidia (NASDAQ: NVDA) seems like it can do no wrong these days. With its shares soaring past $900 recently, it wouldn't be surprising to see them reach $1,000 soon. This is extraordinary considering shares were trading at less than $50 just five years ago. The semiconductor specialist, which has been benefiting from the boom in generative artificial intelligence (AI) as companies race to buy up its advanced AI chips, has become the ultimate Wall Street darling.
Nvidia shares undoubtedly deserved a big run-up given the chip-maker's stellar business performance. The tech company 's revenue soared 126% year over year in fiscal 2024, fueled by a 217% increase in its data center revenue. But the degree of the stock's astronomical gains merits some skepticism.
To help illustrate the risks inherent in Nvidia shares today, I'd go as far as to say that even McDonald's (NYSE: MCD) may be a more attractive long-term investment from here. The boring and mature fast-food burger chain's more conservative valuation and predictable business arguably combine to make a superior value proposition for investors compared to Nvidia. While I recognize this may shock or even aggravate some Nvidia bulls, please hear me out. This isn't a pitch for Nvidia shareholders to sell but rather a reminder that not every stock is right for everyone.
For further details see:
Call Me Crazy: I'd Invest in McDonald's Over Nvidia