Tesla Stock vs. Nvidia Stock: The Best Buy Right Now, According to Wall Street

Tesla (NASDAQ: TSLA) and Nvidia (NASDAQ: NVDA) are the two of the most highly traded and widely discussed stocks on the market. Dan Ives at Wedbush recently said they were two of the "best disruptive technology companies in the world." But most Wall Street analysts see one stock as the better buy.

• Among the 56 analysts who follow Tesla, the median target price is $307 per share. That implies 22% upside from the current share price of $251.
• Among the 69 analysts that follow Nvidia, the median target price is $168 per share. That implies 64% upside from the current share price of $102.

Wall Street analysts in aggregate view Nvidia as a better buy than Tesla at current prices. Here's what investors should know.

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1. Tesla

Tesla reported dismal first-quarter financial results that missed estimates on the top and bottom lines. Sales fell 9% to $19.3 billion, operating margin contracted 3 percentage points to a six-year low, and non-GAAP net income dropped 40% to $0.27 per share. The company also withheld guidance for the second quarter because of uncertainty surrounding U.S. trade policy.

Importantly, CEO Elon Musk on the quarterly conference call acknowledged that his role in the Department of Government Efficiency (DOGE) has brought blowback on Tesla. The company has ceded its position as the leader in battery electric vehicle sales to Chinese automaker BYD, in part because Musk inadvertently politicized Tesla.

Even longtime Tesla bull Dan Ives warned that the brand destruction caused by Musk would be permanent if he failed to separate himself from politics and refocus on the company in the near future. Asset manager Ross Gerber even told Bloomberg that Musk "doesn't care" about Tesla anymore. Fortunately, Musk seems to have taken the hint.

He said on the first-quarter earnings call that his "time allocation at DOGE will drop significantly" in the coming months. Musk also said the company remains on track to launch robotaxi services in Austin by June and predicted Tesla would eventually have 99% market share in autonomous ride-sharing.

Importantly, Musk believes robotaxis could "move the financial needle in a significant way" by the second half of 2026. Of course, the company has overpromised and underdelivered in the past, but some analysts believe the narrative. Gene Munster at Deepwater says Tesla may be a "train wreck" in the short run but a "rocket ship" in the long run.

Wall Street estimates adjusted earnings will grow at 24% annually through 2026, according to LSEG. That makes the current valuation of 110 times adjusted earnings look expensive, but Tesla may surprise to the upside as it leans into robotaxis. Patient investors with a time horizon of at least five years can buy a small position today.

2. Nvidia

Nvidia reported strong financial results in the fourth quarter that beat estimates on the top and bottom lines. Revenue rose 78% to $39 billion on particularly strong sales growth in the data center segment, and non-GAAP earnings increased 71% to $0.89 per diluted share. The only blemish was 3 percentage point decline in gross margin to 73.5%.

Nvidia is the market leader in data center graphics processing units (GPUs), chips used to accelerate complex workloads such as training machine learning models and running AI applications. But the company is particularly formidable because its compute platform includes adjacent data center hardware such as CPUs and networking gear, as well as an expansive suite of software development tools called CUDA.

Nvidia is addressing not only current technologies such as generative AI but also emerging technologies such as self-driving cars and autonomous robots. And because CUDA is the industry standard for accelerated computing, analysts generally think the company will maintain its dominant position in data center AI chips. In fact, Angelo Zino at CFRA Research says Nvidia "will be the most important company to our civilization over the next decade."

Nvidia has a catalyst on the horizon in the ongoing production ramp of its next-generation Blackwell chip. CEO Jensen Huang earlier this year told Yahoo! Finance that demand for Blackwell is incredible, and CFO Colette Kress says gross margin should rebound to the mid-70% range as Blackwell GPUs account for more of total revenue.

Wall Street expects Nvidia's adjusted earnings to increase at 37% annually through fiscal 2027, which ends in January. That consensus estimate makes the current valuation of 34 times adjusted earnings look cheap. Patient investors with a time horizon of at least three years should feel comfortable buying a position today.

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Trevor Jennewine has positions in Nvidia and Tesla. The Motley Fool has positions in and recommends Nvidia and Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.