In a notable strategic move, NVIDIA (NVDA), the dominant force in AI chips, formally completed a $5 billion acquisition of Intel common stock this Monday, fulfilling an agreement announced earlier. This investment is seen as a crucial financial lifeline for Intel, which has been under significant pressure, while simultaneously showcasing NVIDIA’s substantial capital strength.
For investors, however, a more immediate question arises: Is NVIDIA itself, as the investing party, still a compelling buy at its current level?
NVIDIA’s growth momentum appears solid, anchored by consistently explosive financial performance and highly visible future demand. The company has delivered eleven consecutive quarters of soaring revenue growth, with sales reaching a record $57 billion last quarter—a 62% year-over-year increase. Expectations for the next quarter have been raised to approximately $65 billion, underscoring unabated momentum.
More importantly, NVIDIA holds an order backlog of up to $500 billion extending through the end of 2026, providing exceptional revenue visibility for the coming years. Furthermore, the recent authorization to sell its H200 chips in China opens a key market avenue. The next significant positive catalyst is on the horizon. NVIDIA is scheduled to report its full fiscal-year earnings on February 25, 2026, and market consensus strongly anticipates another set of results that will far exceed expectations.
Despite the optimistic outlook, investing in NVIDIA requires careful consideration of potential headwinds. Firstly, the company’s valuation is at a historical high, trading at around 47 times earnings. This lofty multiple already prices in significant growth expectations, meaning any sign of slowing momentum could trigger substantial stock volatility.
Secondly, NVIDIA faces intensifying industry competition and a complex geopolitical landscape. Changes in global supply chains and trade policies, including ongoing restrictions on sales of its advanced chips, remain persistent potential disruptors. Finally, its current explosive growth is heavily reliant on the single, albeit powerful, catalyst of global AI computing demand. Should this sector experience a cyclical downturn or a shift in technological pathways, the resilience of NVIDIA’s performance and stock price would be tested.
The investment in Intel demonstrates NVIDIA’s strategic vision and capital prowess as an industry leader. Yet, when evaluating the investment merit of its own stock, the conclusion is nuanced. For investors with a long-term conviction in the AI trend and a tolerance for high volatility, NVIDIA’s strong fundamentals, near-term order certainty, and market dominance continue to make it attractive, with the upcoming earnings report serving as a key near-term catalyst.
However, its premium valuation means any signal of growth falling short of lofty expectations could prompt a correction. Therefore, this is not a risk-free decision. Investors must carefully weigh the immense growth potential against a stock price that already reflects a highly optimistic outlook.
