Can Nvidia's Stock Still Be a 10-Bagger Investment in the Future?

In 10 years, share prices of chipmaker Nvidia (NASDAQ: NVDA) have jumped by more than 28,350%. It's a staggering return, and one that's hard to conceptualize. Investing $10,000 into this stock a decade ago would have made you a multimillionaire. That size of an investment would now be worth around $2.85 million.

Today, it's far and away the most valuable company in the world, with a market cap of $4.5 trillion. The next largest stocks, Microsoft and Apple, are each worth around $3.8 trillion. Given Nvidia's dominance in the tech sector and the importance that its chips play in artificial intelligence (AI) and its future growth, could this stock that has already grown in value so much still be a potential 10-bagger investment if you add it to your portfolio today?

Why Nvidia might still grow its value tenfold

For Nvidia to generate 10x returns from its current value, you would need to believe that it can eventually reach a market cap of more than $45 trillion. That's a huge valuation, but in 20-plus years, it may be plausible for top tech companies to be worth that much. If Nvidia were to grow by a little over 12% per year on average, after 20 years, it will have risen to roughly 10 times what it is worth today.

When taking the long-term view, it may not seem all that outlandish to expect that the leading AI chipmaker could become worth so much, given how much potential there is for AI to revolutionize virtually every industry. Analysts at Grand View Research believe that there's considerable growth ahead for the global AI chip market and that it will expand at a compound annual rate of about 28.9% between now and the end of the decade. Even if that growth slows in the years afterward, there may still be considerable potential for Nvidia and other AI companies to tap into down the road.

What could get in Nvidia's way?

While there is potential for Nvidia to be a 10-bagger investment, that doesn't mean that it will be a smooth path ahead. There are risks to consider. The glaring one is that stocks may be in a bubble right now, and a crash could be coming in the near future.

Nvidia is a highly successful business, and it generates impressive margins, but it's also trading at more than 50 times its trailing earnings. At such a premium, the stock has a lot of growth already priced into its valuation, which could result in limited returns in the future.

Another risk to consider is the potential for a pullback in AI spending, particularly if there is a recession in the near future. Meanwhile, a recent Massachusetts Institute of Technology study found that 95% of businesses aren't seeing a payoff from their generative AI projects. While AI chatbots are helpful assistants and can improve efficiency for users, that may not be nearly enough to warrant companies' significant investments into making their own AI models or buying AI-powered products and services.

Nvidia's growth has been slowing, and if there's a more drastic decline ahead, that could significantly affect how much growth investors are willing to pay for the stock in the future.

Is it too late to invest in Nvidia?

Nvidia is a top AI stock, but I'm not convinced that it will still yield tenfold returns from where it is today. A lot would have to go right for the company, given how highly valued it is today. Although it is a leading chipmaker today, in 20 years, that may not be the case. Technologies may change drastically -- and so, too, could demand for AI chips.

That being said, it can still prove to be a good long-term investment even if it doesn't generate 10-bagger returns. With strong fundamentals, Nvidia can be a good tech stock to buy and hold for years to come. But with its high valuation, it's important not to set your expectations too high.

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.