This Artificial Intelligence (AI) Company achieved $2 trillion in value last year, and Wall Street thinks it could be headed much higher in 2025

This past year was another great one for technology stocks in particular. Tailwinds driven by artificial intelligence (AI) helped push the S&P 500 higher by 23%, while the Nasdaq Composite won an impressive 29%.

the “Great Seven” stocks were among the market's biggest gainers for the year, and perhaps none got more attention than a semiconductor leader. Nvidia — which was the best performing stock in the Dow Jones Industrial Average in 2024.

Last year, Nvidia gained about $2.1 trillion in market capitalization – the highest of any company. This led Nvidia to become one of the most valuable businesses in the world. While Nvidia's current run might suggest the stock is due for a pullback, Wedbush Securities technology analyst Dan Ives is calling for much more growth for the AI ​​darling — and I agree.

Let's take a look at Nvidia's latest catalysts and make the case for why 2025 could be another one for the record books.

Over the past two years, Nvidia has emerged as the leader of the pack in the AI ​​marathon, and it all boils down to one thing: graphics processing units (GPUs). GPUs are advanced chips necessary for developing productive AI applications.

Nvidia's deep lineup of GPUs has helped the company separate itself from competitors such as Advanced Micro Devicesand procure an an estimated 90% of the GPU market.

To add some context here, Nvidia's dominance has fueled steady revenue and profit growth for the company – allowing it to double down on research and development (R&D) and innovate even newer, innovative products. Enter Blackwell, Nvidia's next-generation GPU architecture, which is said to already be sold out for the next 12 months.

While this is more of a company-specific tailwind, Ives believes that broader investments in AI infrastructure could reduce $1 trillion in the coming years. Nvidia is taking advantage of this windfall from increased capital expenditure (capex), underlined by investments in a European GPU cluster specialist I won'tand the acquisition of AI infrastructure business Run:ai (acquired for a reported $700 million).

Given the massive increase in Nvidia's stock price, it's a smart idea to look at some of the company's valuation metrics and cross-reference them against the catalysts I've included above.

Data source: YCharts.

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