The Nvidia (NASDAQ: NVDA) stock price has done well in the past decade as it evolved into one of the most important companies globally. Its stock has surged by over 301k since going public, a move that has pushed its market cap to over $3 trillion. Nvidia has jumped by more than 26% in the past decade, beating the S&P 500 and Nasdaq 100 indices.
Analysts are still bullish on Nvidia stock
Nvidia’s shares have surged in the past decades as investors reacted to the rising demand for its GPUs amid the ongoing artificial intelligence (AI) hype.
This performance has been reflected on the company’s revenue. Its annual revenue has jumped from over $10.9 billion in 2019 to over $60.9 billion in 2023. At the same time, the net income soared from over $2.7 billion in 2019 to over $29.7 billion in the last financial year.
This growth has accelerated this year as the revenue growth has exploded. The most recent financial results showed that the company’s revenue soared to over $26 billion, up from $7.1 billion in the same period in 2023.
Analysts are optimistic that Nvidia will continue thriving in the next few years. They expect that the company’s revenue will jump to over $120.5 billion this year followed by $161 billion in 2025. If this trend continues, Nvidia’s revenue could soar to over $300 billion in the next few years.
As a result, analysts are still bullish on Nvidia stock. Most of them have a buy rating, with the stock target being at $128.55, higher than the current $123.54. Some of the most bullish analysts are from Cantor Fitzgerald, Citigroup, Jefferies, and Truist Financial. Jim Cramer has also been bullish on the stock.
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Still, as I have warned before, there are risks that the stock could retreat, as we saw with Cisco during the dot com bubble and Tesla. At its peak, Cisco was the biggest company in the world, before it retreated sharply as the bubble burst.
Similarly, Tesla was one of the biggest companies in the world with a market cap of over $1 trillion. It has retreated by over 50% from its all-time high as growth slowed. The same situation has happened among other companies.
The case for the T-Rex 2x Long NVIDIA Daily Target ETF (NVDX)
Therefore, if you are bullish on Nvidia, you could consider the T-Rex 2x Long NVIDIA Daily Target ETF.
This is a leveraged fund that aims to generate 200% of the daily return of Nvidia shares. If Nvidia shares rise by about 1% in a day, the fund rises by 2%.
While the fund focuses on the daily return, its performance has done better by Nvidia in its totality. In 2024, it has jumped by more than 411% while Nvidia shares have risen by about 150%.
NVDA vs NVDX ETF
NVDX’s performance mirrors that of other leveraged funds like the Direxion Daily Semiconductor Bull 3x Shares ETF (SOXL), which has constantly beaten the generic chip ETFs like the iShares Semiconductor ETF (SOXX) and the VanEck Semiconductor ETF (SMH).
Its performance is also similar to that of the ProShares UltraPro QQQ ETF (TQQQ), which has beaten other Nasdaq 100 indices. Therefore, if you are long Nvidia, it makes sense to buy some NVDX to amplify your returns.
However, investing in leveraged ETFs is risky, especially if an asset suffers a harsh reversal, as we saw in 2022 when Nvidia shares dropped by over 67% between its highest and lowest points in 2022. In such a move, the ETF will have a deeper drop, considering that the Nvidia stock has moved into an overbought level.
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