You don't have to dive deep into small-cap stocks and mid-cap stocks to find winners. Some of the biggest opportunities are hiding in plain sight, and despite being the most valuable publicly traded company, Nvidia (NVDA 1.44%) still looks like it has more room to run.
The artificial intelligence (AI) chipmaker addresses a critical part of the AI bottleneck and has big tech customers begging Nvidia to take their money. Accumulating Nvidia can prove to be a great move to start 2026.
The AI boom isn't going away anytime soon
Image source: Getty Images.
You can only be bullish about Nvidia if you believe the AI boom will continue. Luckily, there are a few catalysts that suggest AI is just getting started.
NASDAQ: NVDA
Key Data Points
AI models like ChatGPT and Grok need more Nvidia chips to perform at their best, and since the industry resembles the early days of the internet, tech companies are pouring their capital into the industry. They recognize the hyper-growth opportunities that come with AI mastery.
However, it's not just software that is benefiting from AI. Significant possibilities exist in physical AI. Several AI-powered robots were on full display at CES, and Nvidia CEO Jensen Huang told investors in a press release that "the ChatGPT moment for robotics is here."
Nvidia is fully prepared for AI robots with its CUDA software and Jetson robotics processors. Robots can transform entire industries and become a consumer favorite due to their ability to perform various tasks.
Robots are just one part of physical AI, with autonomous vehicles being another great example. Physical AI can produce several trillion-dollar companies, and Nvidia is right at the center of it. There's no AI bubble here.
Nvidia is still growing faster than most companies
One of the problems with buying a growth stock that is approaching a $5 trillion market cap is that it takes far more capital to generate additional price movements. However, Nvidia is still growing faster than most companies, which makes it easier to outperform the S&P 500.
For instance, Nvidia delivered 62% year-over-year revenue growth in Q3 FY26, and that was a 22% sequential improvement. Net income increased by 65% year over year, resulting in an absurd 56% net profit margin.
Huang told investors that Blackwell sales were off the charts, and cloud GPUs are sold out. Demand seems to be parabolic for Nvidia, and with tech companies expanding their AI budgets, it stands to reason that Nvidia will continue to gain ground. The stock is up by 36% over the past year and has a good shot at outperforming the S&P 500 over the next few years.
