3 Phenomenal Reasons to Buy Nvidia Stock Before 2025

Nvidia (NASDAQ: NVDA) had two phenomenal years in the market, and I doubt that it will be able to repeat its performance in 2025. However, I still think there are plenty of good reasons to own Nvidia stock (or buy more) in 2025.

Although there are numerous reasons, I've come up with three solid ones that convinced me to pick up some Nvidia shares before 2025 arrives.

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1. Blackwell will be a huge tailwind in 2025

Most of Nvidia's growth has been centered around its Hopper architecture. While this design allowed for some incredible accomplishments, Nvidia's next-generation architecture, Blackwell, will be a whole new world.

Blackwell has numerous improvements over Hopper, but perhaps the most useful is that Blackwell can train artificial intelligence (AI) models at more than twice the speed. That's a huge advantage for anyone training AI models, and for companies with nearly unlimited budgets in the AI arms race, it could be a reason to upgrade existing capabilities in 2025.

While Blackwell GPUs are already shipping in 2024, management noted that demand far outpaces production capacity, and expanding production to capture those sales in 2025 will be key.

Blackwell GPUs are slated to be a huge boost for Nvidia in 2025 and will help drive further sales growth.

2. Nvidia's largest clients will be spending more in 2025

To go alongside Blackwell sales in 2025, Nvidia's largest clients already told investors they will spend more on AI computing power and cloud computing capacity next year.

Meta Platforms warned investors in its third-quarter earnings announcement that they should "expect significant capital expenditures growth in 2025." This is centered around Meta's AI computing power buildout, which will significantly benefit Nvidia.

Amazon, which has the largest cloud computing business with AWS, stated on its conference call, "The thing to remember about the AWS business is the cash life cycle is such that the faster we grow demand, the faster we have to invest capital in data centers and networking gear and hardware." In other words, because AWS' revenue growth accelerated in Q3, it needs to invest more to meet the supply. With AWS' AI business growing in the triple-digit-percentage range year over year, it's clear it will need to invest in more Nvidia GPUs if it wants to permanently win potential clients' business.

The demand for AI computing power has not peaked, which will help Nvidia maintain a solid growth rate in 2025.

3. Nvidia's valuation isn't all that expensive

Valuing Nvidia's stock over the past few years wasn't easy. While you could use forward-looking metrics, there has never been a company the size of Nvidia that was growing as quickly and as profitably.

However, Nvidia's growth slowed, even though Wall Street analysts still project revenue to grow by 51% next year. Still, this growth level allows investors to apply more traditional earnings multiples to the stock, and it looks pretty attractive right now.

NVDA PE Ratio data by YCharts

Nvidia's stock trades for 53 times trailing earnings and 30 times fiscal year 2026 earnings (ending January 2026). While those are still historically expensive measures, they are not all that expensive compared to other stocks in the market.

Apple and Microsoft trade for 42 and 36 times trailing earnings, respectively. That's not that much cheaper than Nvidia, despite both companies growing at a far slower pace.

Nvidia's stock really isn't all that expensive for the growth in store for 2025 (encompassing most of Nvidia's fiscal 2026). Investors shouldn't be afraid to add some Nvidia shares while the stock is off from its highs, as it looks like a great bargain heading into 2025.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Keithen Drury has positions in Amazon and Nvidia. The Motley Fool has positions in and recommends Amazon, Apple, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.