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Wolfe names new AI chip stock as Best Idea after ’only’ 36% gain in 2025
Investing.com -- Wolfe Research named its top artificial intelligence pick for 2026 in a note Tuesday, arguing the chipmaker’s relative underperformance leaves room for further upside.
Analyst Chris Caso saidNvidiais being added to the Wolfe Alpha List, replacing Micron, even though “NVDA is up ‘only’ 36% over the past year,” which Wolfe said trails other AI-linked names.
According to Caso, the stock lagged for three key reasons: “the late launch of Blackwell, concerns about the sustainability of AI spending in general, as well as concerns about share losses to custom AI solutions.”
But the firm believes those worries are fading as Nvidia’s product roadmap advances.
“Blackwell is now ramping fully, and Rubin is on time for 2H26 ramp,” Wolfe wrote, adding that Rubin offers “5x inference improvement vs. Blackwell.”
Nvidia’s recent outlook is said to point to “at least $40bn upside to CY26 consensus revenue,” with Caso noting that resumed H200 shipments to China would add further upside.
The firm also highlighted improving pricing power, saying it was “positively surprised by what we heard on pricing for Blackwell Ultra and Rubin,” which it views as evidence of Nvidia’s “competitive moat.”
Competition remains limited, Wolfe stated, arguing “Google’s TPU represents NVDA’s main competition,” while other custom platforms are not scaling at comparable speed.
Despite Nvidia’s strong performance, Wolfe feels the valuation “remains attractive at just 23x our CY26 EPS,” well below its five-year average.
