Only two companies in the world have ever reached a $5 trillion market cap: Apple (NASDAQ: AAPL) and Nvidia (NASDAQ: NVDA). To reach those heights, both are obviously great companies, but which stock looks like the better long-term buy?
In my view, Nvidia has more upside, but it also carries more risk than owning Apple. Let’s dig into the two tech stocks.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
Nvidia
Nvidia has shown some of the best growth among megacap tech companies over the past five years. In its fiscal year 2023 (ending January), it recorded nearly $27 billion in revenue, while this year (fiscal 2027), analysts project it will generate nearly $412 billion in revenue. That’s an astonishing 15-fold increase over five years off a high base. Incredibly, the company has forecast that it will grow its revenue by another 70% next fiscal year.
Nvidia’s growth is coming from the insatiable demand for compute power associated with the artificial intelligence (AI) infrastructure build-out. Its graphics processing units (GPUs) are the main chips used to run AI workloads, and it has created a wide moat for AI model training through its CUDA software platform, where most original AI code was written.
Meanwhile, Nvidia has positioned itself well for the next phases of AI. The inference market is now growing faster than the one for training and is expected to become the much larger market of the two. On this end, the company made a smart move when it “acquired” Groq and its language processing unit (LPU) technology earlier this year. Groq’s SRAM-based (static random-access memory) chips are great for speeding up the decode phase of inference, where models give their response to queries, while its GPUs can be used for the more compute-heavy prefill phase. At the same time, Nvidia has developed its own Arm-based central processing units (CPUs), which are becoming more important with the rise of agentic AI.
Combined with its world-class networking portfolio, Nvidia now offers complete turnkey AI factories specifically designed to handle different AI tasks, like training, inference, and AI agents. This should be the company’s next big growth driver.
Apple
Apple does not have nearly the type of revenue growth that Nvidia has; however, it does have a very sticky business that compounds tremendously over time. This can be seen in its earnings-per-share (EPS) growth over the past five years, which has gone from $6.11 back in fiscal 2022 to a projected $8.83 this fiscal year, representing 45% growth, on only a 21% increase in revenue over the same stretch.
