Nvidia Corp NVDA The stock is trading higher on Monday.

Ken Mahoney, president and CEO of Mahoney Asset Management, told Bloomberg that Nvidia’s valuation has fallen to about 30 times expected earnings after the recent sell-off, which could make the stock more attractive to long-term investors.

The analyst noted that shares of the key beneficiary of artificial intelligence have risen 152% over the past 12 months, despite losing around 15% over the previous 30 days.

Nvidia’s success reflects the company’s ability to build a “walled garden” of developers who use Nvidia chips to build AI systems and other software, the Wall Street Journal reports.

This ecosystem around Nvidia’s CUDA software platform has made it almost impossible for competitors to gain a significant foothold in the AI ​​market.

Nvidia will likely have more influence than its competitors as the company continues to focus on its programming skills.

Introduced in 2007, CUDA enables Nvidia’s specialty chips (GPUs) to run non-graphics-oriented software, including AI applications.

Jensen Huang, CEO of Nvidia, describes this approach as “full-stack computing,” in which the company provides the chips and software needed to build AI systems.

With this strategy, Nvidia has cemented its position as the dominant player in the AI ​​chip market, with an estimated 90% market share expected to remain stable over the next few years.

The AI ​​chip market is forecast to reach $400 billion per year by 2027.

Investors can participate in Nvidia through VanEck Semiconductor ETF SMH And Schwab US Large-Cap Growth ETF SCHG.

Price promotion: NVDA shares were trading 5.30% higher at $110.24 at last check on Monday.

Disclaimer: This content was created in part using AI tools and reviewed and published by Benzinga editors.

Image via Nvidia Blog

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