Nvidia vs. Tesla Stock: Which Is a Better Investment?
Written by
Yaël Bizouati-Kennedy
Edited by
Emily Gadd
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Tesla and Nvidia both belong to a group informally known as the Magnificent Seven — stocks which helped buoy the market in 2023 and contributed most of the S&P 500’s returns last year.
Yet, while 2024 was off to a good start for the group, some stocks are starting to lag, making some wonder whether the Magnificent Seven is now down to a “fab four,” as The Motley Fool reported.
In particular, Nvidia and Tesla now seem to be on very different trajectories.
Tesla Stock Analysis
- Year-to-date: down 31.5% as of April 5.
- Past year: down 8.3% as of April 5.
- Past month: down 5.9% as of April 5.
Tesla announced its first quarter deliveries on April 2, which was “an unmitigated disaster,” according to Wedbush Securities analyst Dan Ives.
“We view this as a seminal moment in the Tesla story for Musk to either turn this around and reverse the black eye 1Q performance. Otherwise, some darker days could clearly be ahead that could disrupt the long-term Tesla narrative,” Ives wrote in an April 2 note.
CFRA Research indicated in an April 2 note that it maintained its Buy opinion on Tesla. However, it cut its 12-month target by $15, to $220.
“Despite near-term headwinds, we continue to regard Tesla as one of the market’s most compelling long-term growth stories and the stock appears to be fully discounting various issues surrounding the name after a precipitous YTD drop,” CFRA equity analyst Garrett Nelson wrote in the note.
Nvidia Stock Analysis
- Year-to-date: up 82.5% as of April 5.
- Past year: up 226.3% as of April 5.
- Past month: up 2% as of April 5.
Nvidia on the other hand — “the most important stock on the planet” — delivered record-breaking earnings on Feb. 21, with revenue rising to $22.1 billion. This figure is up 265% from a year ago, according to the earnings report, largely thanks to its burgeoning artificial intelligence (AI) business. This is what some analysts, such as Ives, deemed “the biggest moment for the market and tech sector in many years,” and a “game changing moment for the tech bulls,” as GOBankingRates previously reported.
CFRA Research has a Buy view on the stock, reflecting its “optimism surrounding NVDA’s pipeline and unprecedented demand for cloud infrastructure spend in favor of NVDA’s offerings,” according to an April 3 research note.
“We see sales rising 80% in FY 25 (Jan.) and 20% in FY 26 after a 126% increase for FY 24,” CFRA Research equity analyst Angelo Zino wrote in the note.
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