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Can Nvidia's Stock Still Be a 10-Bagger Investment in the Future? | The Motley Fool

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  Published in Stocks and Investing on Friday, October 10th 2025 at 4:42 GMT by The Motley Fool
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Can Nvidia Still Deliver the 10‑Bagger Growth that Investors Dream About?

By a research journalist
October 10, 2025

In the world of high‑growth equities, Nvidia (NVDA) has become synonymous with technological disruption and soaring valuations. A recent analysis on The Motley Fool—“Can Nvidia’s Stock Still Be a 10‑Bagger Investment?”—asks the burning question many long‑term holders and new investors are grappling with: is the company still capable of delivering the kind of explosive returns that have made it a darling of the tech‑savvy community? The article takes a hard‑earned look at Nvidia’s fundamentals, market dynamics, and the looming risks that could dent its trajectory.

1. The Anatomy of Nvidia’s Growth Engine

The Fool’s author opens with a recap of Nvidia’s recent earnings reports, noting a staggering 68% year‑over‑year revenue jump in Q2 2025, driven primarily by its data‑center segment. GPUs that power AI training and inference workloads are now the cornerstone of the firm’s business, eclipsing its traditional gaming and professional visualization lines.

Key metrics highlighted include:

• Revenue: $15.3 billion in Q2, a 67% YoY increase.
• Operating margin: 52%, up from 48% a year earlier.
• Diluted EPS: $4.75, marking a 95% increase vs. Q2 2024.

These figures translate into a forward P/E of roughly 28x—well above the historical average for the technology sector but still lower than many peers, according to the piece. The article underscores that Nvidia’s operating leverage has been a major driver: as the data‑center GPU adoption rate accelerates, the incremental cost of producing additional units dips while revenue per unit climbs.

2. The “AI Boom” – A Blessing and a Curse

Nvidia’s “AI boom” is a double‑edged sword. On one side, the firm’s CUDA ecosystem has become the de facto software stack for researchers and enterprises building machine learning models. On the other, the very same boom fuels demand for Nvidia’s hardware, creating a virtuous cycle that feeds future growth.

The author cites a Bloomberg piece (linked in the article) that illustrates how Nvidia’s revenue mix is shifting: gaming now accounts for just 27% of total sales, while data‑center constitutes 55%. The remaining 18% comes from automotive, professional visualization, and edge computing.

A critical nuance is the potential for cumulative saturation—the point at which the total addressable market for GPUs in AI has been largely captured. While the article acknowledges that Nvidia still has sizable headroom in data‑center workloads, it notes that the company’s growth rate may slow as the “AI boom” matures and the cost of training state‑of‑the‑art models continues to rise.

3. Competitive Landscape and Regulatory Headwinds

No growth story is immune to competition, and Nvidia’s rivals are tightening the screws. AMD’s Radeon Instinct line has begun to win market share in the GPU‑centric AI arena, offering comparable performance at a lower price point. Meanwhile, Google’s Tensor Processing Units (TPUs) and Apple’s custom silicon are carving out niche territories that could siphon off future customers.

The article also flags regulatory scrutiny, especially in China where Nvidia’s chips are used in advanced AI research that could have dual‑use implications. A potential export restriction could stall Nvidia’s expansion in one of its most profitable markets.

4. Valuation – The 10‑Bagger Question

A 10‑bagger implies a 1,000% return over a relatively short period. The Fool’s author revisits Nvidia’s historical returns: since its IPO in 1999, the stock has delivered an average CAGR of 28%, already outpacing most peer groups. Yet, when compared to the broader market, the question remains: can the company push its valuation higher without losing traction?

A key point made in the article is that the “price-to-sales” (P/S) ratio sits around 11x, which is high but not unprecedented for AI companies with high growth prospects. The article references an Forbes link that argues Nvidia’s P/S could be justified by its “leadership in AI hardware” and the company’s “highly scalable business model.” However, it cautions that the upside may be limited if the company’s growth stalls.

5. The Bottom Line – A Gradual Upside

After weighing the upside and downside factors, the author concludes that Nvidia remains a compelling investment but one that may not produce a 10‑bagger in the next five years. Instead, the piece suggests a “steady‑poker” approach: maintain exposure to the company as a core holding in a diversified portfolio, and let the stock grow organically with the AI market.

The article is peppered with actionable takeaways, such as:

• Monitor revenue mix changes – an increase in gaming revenue might signal a shift away from AI, potentially diluting future growth.
• Watch for AMD and Google – any major breakthroughs could erode Nvidia’s market share.
• Stay alert to geopolitical developments – trade tensions could suddenly cut off a key revenue source.

6. Where to Learn More

The Fool’s analysis links out to several supplementary resources that add depth to the discussion:

• A Bloomberg article on Nvidia’s earnings that offers a deeper dive into the financial numbers.
• A Forbes piece that critiques Nvidia’s valuation from a valuation analyst’s perspective.
• An MIT Technology Review feature on the next generation of AI hardware that explains why Nvidia’s architecture may or may not hold the edge.

These links collectively provide a broader context, helping readers understand that while Nvidia’s prospects are robust, the market dynamics in AI and GPU technology are shifting rapidly.

Final Verdict

Nvidia’s recent financials, strategic positioning, and AI dominance paint a picture of a company still on a growth trajectory that could, in theory, deliver substantial returns. Yet, the high valuation, rising competition, and potential regulatory constraints temper the likelihood of a 10‑bagger within the near term. Investors would do well to treat Nvidia as a high‑quality growth component rather than a “sure thing” that will skyrocket overnight. The company’s performance will hinge on how it navigates the competitive tech landscape, expands its product pipeline, and responds to the geopolitical environment that increasingly influences global supply chains.