Josh Brown Sees Catalysts Driving Nvidia Stock Higher In 2022 And Beyond

Despite falling nearly 15% over the last month, NVIDIA Corp NVDA has been the best performing chip stock in 2021.

UBS is anticipating another strong year ahead for the chipmaker. The analyst firm named Nvidia a top pick for 2022 on Tuesday. UBS analyst Timothy Arcuri expects Nvidia to benefit as it builds more stable revenue streams around its GPU and software segments.

Brown's Take: "GPU chips are going to be on fire all year," Ritholtz Wealth Management CEO Josh Brown said Tuesday on CNBC's "Fast Money Halftime Report."

GPU chips are needed for video gaming, PC gaming and console gaming. GPUs are also necessary to power "hyperscale data centers, which is the next level where everyone is going," Brown said.

"The demand so far outstrips anything that any company can supply that it's going to be all systems go almost no matter what happens in the broader economy," he added.

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He noted that the stock is more expensive than it has been in the last three years, but he doesn't expect valuation to hold it back. According to Brown, Nvidia is expected to play a huge role in the future, so people are willing to pay higher prices for the stock. 

"Nvidia is almost the only show in town, and that business is growing at a CAGR (compound annual growth rate) that you really can't find anywhere else in technology," Brown said.

There are also other catalysts ahead that are a bit further away, but will likely be the main drivers for the stock in the future, he said; "Everything from robotics to AI, virtual reality, the omniverse ... autonomous driving."

NVDA Price Action: Nvidia has traded as high as $346.47 and as low as $115.66 over a 52-week period.

The stock was up 4.62% at $290.0 at time of publication.

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Photo: courtesy of Nvidia.