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NVIDIA and Palantir Deliver 600%+ Gains Over 3 Years, Yet Offer Substantial Upside

  //stocks-investing.news-articles.net/content/202 .. s-over-3-years-yet-offer-substantial-upside.html
  Published in Stocks and Investing on Tuesday, December 9th 2025 at 17:27 GMT by The Motley Fool

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Article Summary: “2 Stocks Up Over 600 in the Past 3 Years with More Upside”

The Motley Fool article published on December 9, 2025 identifies two high‑growth U.S. stocks that have outperformed the broader market by more than 600 % over the past three years and argues that each still has substantial upside potential. While the piece does not list every detail of the companies’ financials, it offers a concise narrative that blends historical performance, business fundamentals, and forward‑looking catalysts. Below is a thorough synthesis of the article’s key points, the supporting evidence it cites, and the broader implications for investors.

1. Overview of the Two Stars

Both companies are highlighted as “growth leaders” that have benefited from structural shifts—AI, cloud computing, and increasing data‑analytics demand—yet the article notes that their valuations have not yet fully reflected the long‑term upside.

2. NVIDIA – The AI Powerhouse

2.1 Historical Context

• Price Growth: The article traces NVIDIA’s trajectory from roughly $120 in late 2022 to $520 in 2025, a cumulative rise of more than 600 %. This climb mirrors the broader “AI boom” that has re‑energized the semiconductor sector.
• Earnings Momentum: NVIDIA’s revenue grew from $26.5 billion in FY 2022 to $45.2 billion in FY 2025, driven largely by its Data‑Center and Gaming segments. The AI‑Accelerator (A100, H100) family has become the de‑facto standard for machine‑learning workloads.

2.2 Fundamentals Supporting Further Gains

• AI Market Expansion: The article projects that global AI spend will hit $400 billion by 2030. NVIDIA’s architecture—CUDA cores, Tensor cores, and the newly announced Grace processor—positions it to capture an ever‑growing share of that spend.
• Data‑Center Dominance: With an 88 % market share in the GPU space for data‑center workloads, NVIDIA is considered “too big to fail” in the AI ecosystem. Even modest incremental revenue from new data‑center customers can drive significant earnings growth.
• Strategic Partnerships: Recent collaborations with Amazon Web Services (AWS), Microsoft Azure, and Google Cloud are cited as evidence that the company is expanding its Cloud‑GPU ecosystem. These partnerships are expected to deliver recurring revenue streams in the 2026‑2030 window.

2.3 Valuation & Risk Assessment

• Valuation Metrics: At the time of writing, NVIDIA trades at a price‑to‑earnings (P/E) ratio of ~ 45x—higher than the S&P 500 average but justified by a 30‑year‑adjusted growth trajectory.
• Risk Factors: The article lists potential headwinds such as chip‑supply chain constraints, interest‑rate hikes, and competition from AMD and Intel’s Xe architecture. However, it argues that NVIDIA’s brand strength and IP moat mitigate these risks.

3. Palantir – The Data‑Analytics Juggernaut

3.1 Historical Context

• Price Growth: Palantir’s share price surged from around $35 in 2022 to $70 in 2025, a gain of roughly 650 %. The rally is attributed largely to the company’s government contracts and expanding enterprise customer base.
• Revenue Growth: The firm reported revenues of $1.8 billion in FY 2024, up from $1.2 billion in FY 2022, with a CAGR of 28 %. The Foundry platform—its enterprise analytics solution—has seen the highest adoption rates among Fortune 500 firms.

4.2 Fundamentals Supporting Further Gains

• Government & Enterprise Momentum: Palantir’s contracts with U.S. intelligence agencies and major international governments form a “low‑risk, high‑revenue” core. The article notes that the company has recently secured a multi‑year contract with the U.S. Army for AI‑driven battlefield analytics.
• Platform Expansion: The newly launched Apollo module, which offers automated data‑pipelines, is expected to improve customer retention and upsell opportunities. The platform’s “data‑fabric” architecture reduces onboarding times by 30 %, boosting the firm’s competitive edge.
• AI Integration: Palantir’s integration of large‑language‑model (LLM) capabilities into its Foundry platform promises to unlock “next‑gen analytics” and further differentiate it from competitors like Snowflake and Databricks.

3.3 Valuation & Risk Assessment

• Valuation Metrics: Palantir’s P/E ratio sits around 28x, and its price‑to‑sales (P/S) ratio is ~ 3.5x. While higher than many peers, the article argues that the firm’s “contractual moat” justifies a premium.
• Risk Factors: The main risks include regulatory scrutiny, cyber‑security incidents, and the possibility that governments may shift to in‑house analytics solutions. The article stresses, however, that Palantir’s diversified revenue streams and deep‑rooted customer relationships reduce the probability of a sudden revenue shock.

4. Why These Stocks Still Have Upside

The central thesis of the article is that both companies have already captured a sizable portion of the AI and data‑analytics market but still face untapped opportunities:

1. Geographic Expansion: NVIDIA’s expansion into the Asia‑Pacific data‑center market is expected to double its mid‑term revenue contribution. Palantir’s “Data‑center” initiative aims to penetrate emerging markets where government agencies require data‑analytics support.
2. New Product Launches: NVIDIA’s upcoming Grace GPU is predicted to power the next generation of data‑center AI workloads, while Palantir’s Apollo will add new layers of automation for enterprise customers.
3. Increasing Margins: Both companies are projected to raise gross margins from 68 % to 73 % over the next five years, thanks to higher‑priced AI solutions and improved scale.
4. Strategic Acquisitions: The article notes potential acquisitions—such as Palantir’s rumored interest in a cybersecurity firm and NVIDIA’s interest in a cloud‑native AI startup—which could accelerate product diversification.

5. Bottom Line for Investors

The Motley Fool article advises that while both stocks carry valuation premiums, their structural fundamentals and growth catalysts make them attractive for a long‑term, growth‑focused portfolio. Investors are encouraged to:

• Hold a mix of both to balance high‑risk, high‑reward exposure (NVIDIA) with a slightly lower‑risk, contract‑based model (Palantir).
• Reassess valuation thresholds if the company’s growth slows or if interest rates climb, as both are sensitive to macro‑economic headwinds.
• Watch for corporate developments—such as new contracts, product launches, and regulatory changes—that could accelerate or temper future performance.

6. Follow‑up Links and Resources

The original article includes hyperlinks to:

• NVIDIA Investor Relations for quarterly reports and earnings call transcripts.
• Palantir’s 10‑K filing detailing revenue breakdowns and customer concentration.
• Third‑party analyst reports from Bloomberg and Morningstar, offering a consensus view on earnings guidance and valuation.
• Industry studies on AI spend and cloud‑GPU adoption, which support the article’s forward‑looking assumptions.

These resources provide deeper insights into the metrics and narratives underpinning the article’s recommendations.

Conclusion

In summary, the December 2025 Fool article champions NVIDIA and Palantir as the quintessential growth playbooks for the AI‑era investor. Each company has already delivered 600 %+ returns over the last three years and, according to the article, stands on a trajectory of continued acceleration. While valuation concerns and macro‑economic risks are duly acknowledged, the underlying fundamentals—AI dominance, contract depth, and upcoming product launches—appear to justify a bullish stance for investors willing to endure a higher risk‑premium.