Tracking the moves of billionaire hedge fund managers is a smart move for investors. While simply following their trades isn't a good idea, seeing what they're doing to confirm your moves is a good gut check. Fortunately, any fund with over $100 million in assets is required to disclose its holdings 45 days after the end of a quarter through a Form 13F.
One billionaire I keep tabs on is David Tepper, and he spent most of 2025 loading up on Nvidia (NVDA 1.53%) stock. At the end of the first quarter, his fund, Appaloosa Management, owned 300,000 shares of Nvidia. As of the end of the third quarter, it now owns 1.9 million. That's a huge number of shares to load up on throughout the year, and it is now the company's fourth-largest holding.
Clearly, there's something here, and I think loading up on Nvidia is a smart move for all investors heading into 2026.
Image source: Getty Images.
The AI buildout still has a long way to go
Nvidia makes graphics processing units (GPUs), which have been the go-to computing unit since the AI buildout began in 2023. Nvidia's technology stack is second to none, and even as more competition emerges, its chips have remained a top option.
Demand for Nvidia's GPUs has been incredible, and its CEO Jensen Huang noted during its Q3 fiscal year 2026 (ending Oct. 26) that it's "sold out" of cloud GPUs. So, while some investors are concerned that an AI bubble will burst, that doesn't reflect reality.
AI hyperscalers are spending all their available cash flows (and sometimes more) to build as much artificial intelligence computing capacity as possible. While headlines suggest that companies are starting to choose computing devices other than Nvidia's GPUs, the reality is that Nvidia cannot meet the computing demands of its clients. Instead of decreasing demand, they are turning to alternative computing suppliers.
NASDAQ: NVDA
Key Data Points
Nvidia is still working to ramp up production, which will allow it to deliver monster growth next year and many years beyond, as the demand for AI computing power is expected to last for multiple years. Nvidia's official projection is that global data center capital expenditures will continue to rise to $3 trillion to $4 trillion annually by 2030. That's incredible growth, especially since the total for 2025 is expected to be about $600 billion.
Tepper can see this, which is why he chose to load up the fund on Nvidia stock in 2025. I think that's a brilliant move, and the recent stock price decline has opened up a massive buying opportunity.
Nvidia's stock is on sale
Nvidia's stock is around 10% off from its all-time high. While that's not a fire sale price, it is a decent chunk off one of the world's largest and fastest-growing businesses. Thanks to the decline, Nvidia now trades for 24 times next year's earnings.
NVDA PE Ratio (Forward 1y) data by YCharts
That's a reasonable price to pay for any big tech company, let alone Nvidia. With the monster growth expected in 2026 and beyond, today's stock price is a no-brainer. After all, it's cheaper than others like Apple (30 times next year's earnings) and Alphabet (28 times next year's earnings).
Nvidia is in a fantastic position to capitalize on the massive data center buildout. The recent sale price is a gift for investors, and I think everyone should be taking advantage of it by scooping up shares. While investors may be growing fatigued by the AI focus, we still have several years to go before we've built enough computing capacity to meet what's necessary. As a result, Nvidia will continue to be an excellent buy.
