The Nvidia (NASDAQ:NVDA) story already feels well understood. The company dominates AI chips, has become the world’s most valuable public company, and continues to deliver financial results that routinely exceed expectations. Yet, some bulls argue that the market is still thinking too small.
NVDS: built for a short position on NVDA
While Nvidia’s success is often tied to GPUs and data centers, the company’s opportunity reaches much further. From AI factories and sovereign AI infrastructure to robotics, autonomous machines, and next-generation computing platforms, Nvidia is building the foundation for what could become several trillion-dollar markets.
Among those bulls is one investor, known by the pseudonym Quality Growth Investor, who believes it’s time to think bigger.
“I want to make the case for something beyond the data center story that we all know and love,” shares the investor.
That would be physical AI, which the investor calls the “next frontier.” Specifically, he argues that today’s AI largely resides inside servers and data centers. The transition to physical AI will expand the opportunity into the real world, such as with robots, autonomous vehicles, industrial machines, and logistics systems.
“Physical AI is where I believe NVIDIA will unlock the next decade of growth,” the investor explains, adding that this includes both initial hardware sales and recurring software license fees.
The investor believes Nvidia is already laying the groundwork for that future. He points to the company’s Isaac and Cosmos AI models for robotics, its Omniverse simulation platform, and its Newton physics engine as evidence that Nvidia is creating a full-stack ecosystem for training and deploying intelligent machines. According to the investor, that strategy is already gaining traction, with companies such as Boston Dynamics, Caterpillar, Hyundai, Toyota, Mercedes-Benz, and BYD using Nvidia technology across robotics and autonomous-driving applications.
Early signs of that opportunity may already be emerging. Nvidia’s automotive business generated a record $2.3 billion in revenue during fiscal 2026, up 39% year-over-year. While still small relative to Nvidia’s overall revenue base, the investor views the segment as an early indicator of how physical AI could eventually become a meaningful growth driver for the company.
Though the investor admits that NVDA isn’t exactly cheap by traditional valuation measures, he still believes the stock offers compelling value. In his view, the market is not fully accounting for the long-term opportunity presented by physical AI.
The investor estimates that NVDA can grow revenue at roughly 35% annually for years to come, a forecast that differs from consensus primarily because he expects physical AI to become a meaningful contributor over the longer term. Based on that assumption, he calculates a fair value of $260 per share, implying about 21% upside from current levels.
“We are in the early innings of a transition that will see artificial intelligence move from the cloud into every corner of the physical world,” the investor concluded. “In my opinion, the company best positioned to monetize that transition is NVIDIA.”
“Buy, Buy, Buy,” summed up the investor, who rates NVDA a (you guessed it) Strong Buy. (To watch Quality Growth Investor’s track record, click here)
Wall Street remains firmly in Nvidia’s corner as well. With 38 Buys, 1 Hold, and 1 Sell, NVDA enjoys a Strong Buy consensus rating. Analysts see additional room to run, with the average 12-month price target of $309.94 implying upside of 44%. (See NVDA stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
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