A decade ago, one name consistently topped investors’ portfolios—from Wall Street legends like Warren Buffett to everyday retail traders: Apple (NASDAQ:AAPL). Fast forward seven years, and Nvidia (NASDAQ:NVDA) took that spot, becoming the first company to surpass a $4 trillion market cap and earning a place in virtually every growth-focused portfolio.
There’s no doubt that Nvidia is an exceptional company. With its clear dominance in the artificial intelligence (AI) space, relentless innovation, and market leadership, it’s hard to argue against its potential. The company continues to lead the charge in AI, data centers, and even has its sights set on autonomous driving.
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Why Nvidia Is Still Great—But May Be Fully Priced
Some investors believe that simply holding Nvidia is a ticket to long-term financial success—and to a large extent, they’re not wrong. But even the greatest companies eventually reach a point where growth slows or competition reshapes the landscape.
Take Apple, for example. It was an early adopter of AI with Siri, but its stock soared not because of AI, but due to a strong ecosystem built around iOS, sleek design, and unmatched brand loyalty.
Similarly, Nvidia’s stock has climbed thanks to its early success in gaming GPUs, crypto mining, and more recently, AI-powered data center solutions. Its future potential in autonomous vehicles is promising—but growth like this often comes at a cost.
Nvidia’s valuation is stretched. As of now, it trades at a forward P/E ratio of 38 and a five-year PEG ratio of 1.27, indicating that investors have already priced in extremely high earnings growth. While that growth has been spectacular—EPS jumped 600% in FY2024, 147% in FY2025, and another 44% in the first half of FY2026—such explosive growth is hard to sustain indefinitely.
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The Underrated Stock With Major Upside
This brings us to a company that may not command the same headlines, but holds significant upside potential: Advanced Micro Devices (NASDAQ:AMD).
Once seen as a distant competitor to Intel and Nvidia, AMD has undergone a remarkable transformation. Back in 2014, it lagged far behind in both innovation and market share. But under focused leadership, the company streamlined its product roadmap and began targeting high-growth opportunities—particularly in data centers, AI, and semiconductors for custom applications.
Unlike Nvidia, AMD doesn’t always make the flashiest tech breakthroughs. But neither did Apple or Tesla at the start—they refined existing technologies and scaled them better than anyone else.
AMD is now better positioned than ever to capitalize on rising demand for AI processing, cloud infrastructure, and next-gen computing—all while trading at more reasonable valuations compared to Nvidia.
Final Thoughts
Nvidia is undoubtedly a strong long-term holding and will likely continue to benefit from the AI revolution. But for investors looking for the next big upside, AMD offers a compelling opportunity. It may not be as flashy or widely recognized as Nvidia, but that’s exactly what makes it attractive—a smart investment hiding in plain sight.
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