"Metaverse" has become a buzzword, but what does it really mean, and why should investors care? Loosely speaking, the metaverse is a 3D digital world where people can interact using emerging technologies such as virtual reality (VR), augmented reality (AR), and artificial intelligence (AI), among others. Imagine putting on a VR headset and relocating to the office with your colleagues or the world of a video game with your friends. That's where we're heading, and it's surely a fascinating concept.

According to Precedence Research, the global metaverse market is forecast to climb at a compound annual growth rate (CAGR) of nearly 51% from 2022 through 2030, up to a jaw-dropping $1.6 trillion. From an investor's standpoint, the opportunities for growth are endless. I certainly don't want to miss out. 

So, here's a stock that investors can buy today to cash in on the metaverse in the years to follow.

Person wearing a virtual reality headset with blue and pink background.

Image source: Getty Images.

Nvidia will play a major role in the metaverse revolution

Nvidia (NVDA 1.87%), best known for designing and manufacturing graphics processing units (GPUs), will have a key role in shaping the metaverse. In late 2021, the company rolled out NVIDIA Omniverse, a platform for virtual collaboration and real-time, physically accurate simulation, which will allow creators, designers, researchers, and engineers to connect tools and projects in a shared digital space. For example, the company recently partnered with world-class defense contractor Lockheed Martin to perform an AI simulation of a wildfire that will eventually help to determine the best actions to minimize damage from these disasters. 

Beyond its Omniverse platform, the company's chip systems and GPUs power a variety of products and tools related to gaming, cryptocurrency mining, and other business areas that are closely linked to the metaverse. In the opening quarter of its 2023 fiscal year, Nvidia grew total revenues by 46% year over year to $8.3 billion, topping analysts' estimates by 2.4%, and its adjusted earnings per share increased 49.5% to $1.36, beating consensus by 5%.

Likewise, Nvidia's adjusted gross margin and operating margin expanded 90 and 255 basis points, respectively, up to 67.1% and 47.7%. For the full year, Wall Street analysts predict the tech firm's top line will rise 23.9% to $33.3 billion, and its earnings per share will rise 20.3% to $5.34. Those strong growth rates in the midst of a wobbling economy, combined with the fact that its stock price has contracted 39.7% since the start of 2022, make for a compelling buy case. Currently, the stock bears a price-to-earnings multiple of around 49. Though that may seem high in isolation, it is actually strikingly below Nvidia's five-year average of 59.0.

Should you buy Nvidia stock right now?

I absolutely think Nvidia is a great investment now. The tech company has endured a hefty fallback so far this year, creating a nice window of opportunity to accumulate shares. Still growing fast, Nvidia already operates a widely profitable business, making it a more solid and less risky metaverse play than many other stocks aiming to build a piece of the industry. If you don't want to miss out on the metaverse revolution, then I'd suggest considering an investment in this tech giant today.