Nvidia (NASDAQ:NVDA) The stock is rising in today’s trading. The company’s stock price was up 1.3% as of 3:15 p.m. ET and was up 4.8% earlier in the trading day. Now it is S&P 500 (SNPINDEX: ^GSPC) was down 1.5%, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) was down 1.9% due to hawkish comments from Federal Reserve Chairman Jerome Powell made in conjunction with a rate cut.

Multiple upside catalysts

Nvidia stock is rising today thanks to several catalysts. TrendForce today released a new report analyzing the production outlook for the artificial intelligence (AI) leader’s next-generation Blackwell processors. TrendForce expects production of the company’s GB200 processors to ramp up quickly and peak in the second and third quarters of next year. Production of the new chips has been largely as expected so far, and that’s good for Nvidia and its investors.

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Nvidia stock may also have gotten a boost from a new report from The Financial Times pointing this out Microsoft has purchased more than twice as many of the AI ​​processing leader’s chips this year as the company’s second-largest customer Metaplatforms. This could be a signal that Meta and other big tech companies still have a lot to invest when it comes to AI infrastructure. Additionally, Nvidia announced the Jetson Orin Nano Super Developer Kit, a new generative AI processor for hobbyists and students priced at $249.

Is Nvidia stock a buy?

Nvidia stock has been red hot this year, rising around 167% for the year. Even though the share price is around 11% below its all-time high, the company still has a strong growth-sensitive valuation and is a risky and lucrative investment candidate.

NVDA PE Ratio (Forward) data from YCharts

At around 45 times this year’s expected earnings, Nvidia’s share price already has strong future performance embedded. On the other hand, the company has increased sales and profits at a rapid pace – and the impressive momentum is likely to continue.

The stock currently has a price-to-earnings-growth ratio (PEG) of around 0.3. Meanwhile, a PEG ratio of less than 1 is often viewed as an indicator that a company is undervalued because its earnings have increased faster than the corresponding increases in its valuation.

Given Nvidia’s dominance in processors for advanced AI applications, the stock still appears to be a worthwhile buy for risk-tolerant investors at today’s prices. While the company will undoubtedly experience some cyclical shifts in demand that impact revenue and profit performance, there are good reasons to believe that investments in AI infrastructure are still in the early stages of their long-term development.

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*Stock Advisor returns as of December 16, 2024

Randi Zuckerberg, a former director of market development and spokesperson for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms, Microsoft and Nvidia. The Motley Fool recommends the following options: long $395 January 2026 calls on Microsoft and short $405 January 2026 calls on Microsoft. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.