Why March Could Be a Turning Point for Nvidia Stock

Nvidia (NASDAQ: NVDA) stock has blasted higher over the past several years, and this is for a very good reason: The company has assembled an artificial intelligence (AI) empire, becoming the key player in this high-growth industry.

Analysts expect the AI market to reach beyond $2 trillion by the early part of the next decade, and Nvidia is set to benefit. The tech giant sells the graphics processing units (GPUs) that are the most sought-after worldwide due to their speed and efficiency. They power tasks that are unavoidable along the AI path, such as the training of large language models.

Nvidia's earnings continue to soar, yet the stock's performance has been lackluster since the start of the year. But this downward trend may not last much longer. Here's why March could be a turning point for Nvidia stock.

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Why Nvidia stock has slipped

First, a quick note about why Nvidia stock has lost momentum in recent weeks. This isn't for a reason that's specific to Nvidia. Instead, it's part of general concerns about high AI spending, whether it's sustainable, and whether the growth opportunities match these levels of spending. All of this, along with generally high stock valuations, has weighed on investors' appetites for AI stocks -- even as Nvidia and peers continue to report rising earnings and speak of high demand for AI.

As a result, Nvidia stock and many other AI stocks have declined since the start of the year.

Now, let's consider why March may represent a positive turning point for Nvidia. The company will hold GTC, its major AI conference, from March 16 through 19. This is a big event for Nvidia as it offers the company an opportunity to speak about AI developments as well as the future of the technology and Nvidia's evolving role.

Words from Jensen Huang

Nvidia chief Jensen Huang will keynote the event, and he's known for highlighting the company's latest breakthroughs and offering investors a clear idea of what's to come. Other leaders in the field are scheduled to speak, too, and various sessions will focus on AI-related subjects from robotics to AI agents.

This reminder that AI continues to advance and Nvidia remains at the forefront could assuage some investors' recent worries and once again spur excitement about the AI story. On top of this, Nvidia shares are trading at dirt cheap levels right now, for about 21x forward earnings estimates. This might prompt even the cautious investor to take a look and consider picking up a few shares.

So, as GTC arrives and unfolds, March could be a turning point for Nvidia stock, making now a great time to get in on this top AI player.

Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.