Should Investors Buy AMD Stock Instead of Nvidia Stock for 2026? | NVDA Stock Analysis | AI Stocks

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엔비디아와 AMD를 매출 성장, ROIC, DCF 밸류에이션으로 비교. 엔비디아는 AI 데이터센터 점유율 압도적이고 ROIC가 매우 높으나 지속 불가능하다고 봄. AMD는 하이퍼스케일러들의 공급처 다변화 수요로 점유율 확대 기대. 밸류에이션상 엔비디아 DCF 200 vs 시장가 179로 저평가 쪽, AMD DCF 193 vs 시장가 220으로 고평가 쪽. 포워드 PER은 엔비디아 26, AMD 40. 발언자는 엔비디아 보유 중이며 엔비디아 선호.

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01. Nvidia and AMD are two of the companies benefiting most significantly . But which one is a better stock to buy for 2026 and beyond? That's the question I'll answer in this video by comparing the two companies on revenue on return on invested capital. And then I'll share with you my proprietary discounted cash flow valuations and reveal my pick for 2026 and beyond.

02. &, comparing these two on revenue shows a stark contrast, doesn't it? Look at the increase in revenue for Nvidia starting in 2023. They were closely connected from 2016 to 2023. Even though Nvidia had been outperforming AMD in revenue, but the difference was magnified and exponentially so following 2023 when Nvidia's revenue soared from 27 billion up to 131 billion over the trailing 12-month period.

03. Of course, the biggest reason is Nvidia's dominance in market share in the data centers that are optimized for artificial intelligence. This is the primary category that Nvidia dominates and generates most of its revenue and profitability. This segment is roughly half of AMD's business and it's increasing.

04. AMD has recently produced new products for this market and is gaining market share, but it's still a relatively small player in this industry. Investors are hopeful that AMD will grow to gain more market share and I think it will. And the reason why I've been saying and suggesting that AMD will increase market share is because the large customers that are purchasing Nvidia's products, they feel uncomfortable with Nvidia dominating the market so exclusively.

05. It gives Nvidia too much negotiating power. And these companies don't like that. And those companies are Alphabet, Microsoft, Amazon, Meta Platforms. They're purchasing upwards of hundreds of billions of dollars uh collectively almost $400 billion dollars in these uh building these data centers optimized for AI.

06. They don't like to be dependent on one supplier. And so some of them have been investing in their own internal chip development. Those are Amazon, Microsoft, and Alphabet. And then they're also giving companies like AMD a chance. They're giving them more chance than they otherwise would have if this was a more fragmented market, but they're giving AMD more of an opportunity because they want AMD to grow to balance Nvidia.

07. And so, for that reason, I'm uh optimistic about AMD's prospects going forward. However, I don't expect AMD to take meaningful market share away from Nvidia, only enough to give a balance for those large hyperscalers that are purchasing these GPUs. Nvidia is still well ahead of the competition and the hyperscalers prefer undoubtedly Nvidia's products, but they want somebody else in there just to give them some negotiating power just so Nvidia can't dictate prices without facing uh risk that the customers will go to a rival provider.

08. The next thing I wanted to compare these two on is return on invested capital. And again, Nvidia demonstrates its superiority here. Since 2023, yes, but also for the better part of the previous decade, Nvidia has demonstrated a phenomenal return on invested capital with the lowest point being 21.4% 4% with much of the previous decade boasting returns on invested capital over 50% which is remarkable and several periods of over 100% returns on invested capital and the most recent period the trailing ROIC for the trailing 12-month period at 175%.

09. This number is so good that I don't think it's sustainable. That's how strong it is. And the reason why these kinds of profits are not sustainable is because competitors notice these profits. They make investments to take market share. And that investment, that increase in competition hurts your profitability.

10. Even if the competition is not as good as you, just by the sake of being in the industry, I'll give you one example. If your competition uh if competition comes in, even if they're not good, they're buying up supplies and materials, the raw materials that go into these products, they're taking up manufacturing capacity with your same manufacturing partner, right?

11. AMD and Nvidia use some of the same manufacturing partners, which then drives up drives up the cost of goods sold for Nvidia because now you have competition bidding up prices. So for that reason, and there's many more, the return on invested capital above 175% unsustainable, but it's great. AMD struggling with its ROIC since 2022.

12. Hasn't demonstrated a trailing 12-month period over the previous four years at above 5%. But I expect going forward these numbers will rise significantly for AMD as they ramp up production of their next generation GPUs which already have billions of dollars of orders waiting to be fulfilled. So now let's look at valuation.

13. I calculated a proprietary discounted cash flow value for AMD at $193 per share. The current market price is $ 220. Applying a margin of safety, I'll say that this stock looks fairly valued. For Nvidia, I calculated a proprietary DCF. Also, the intrinsic value per share coming in at 200. The current market price at 179.

14. Again, applying a margin of safety, I would say it looks fairly valued, but closer to undervaluation. And then AMD is fairly valued, but closer to overvaluation based on my proprietary models. And then when I go back to fiscal.ai, which is where I've been getting all the charts, there's a link in the description if you're interested.

15. Nvidia stock looks considerably cheaper here at a forward PE of 26 compared to a forward PE of 40 for AMD. So if I had to pick between one of these two, it's a relatively easy decision for me. I would go with Nvidia. And in fact, I own Nvidia stock. I bought Nvidia stock earlier this year at around $93 per share.

16. Hey, thanks for watching. I truly respect every viewer who takes the time to seek qualified financial analysis. Unfortunately, there are a lot of unqualified voices online giving unsubstantiated stock advice. My goal is to provide research that's grounded in data and professional training, not just what's popular.

17. For those new here, I hold a master's degree in financial economics. I'm a CFA charter holder, an author, an adject professor of finance and economics. I've spent nearly a decade researching stocks professionally and I'm here to help you make informed investing decisions. If you found value in this analysis, make sure to subscribe and consider joining the channel as a member for early access and indepth membersonly content. And