I’ve already got one eye on next year, hunting around for the big themes and which growth shares could outperform the rest of the market. Even though I’m still building my list, I thought it would be worth checking in with ChatGPT to see if the AI bot had some ideas that I might have missed. The answer was pretty surprising.
A rather generic pick
ChatGPT told me that if it had to pick one high-conviction growth share heading into 2026, it would select Nvidia (NASDAQ:NVDA). In terms of reasoning, it spoke about how the company is at the heart of the AI boom. Indeed, the company’s chips are widely regarded as the leading hardware for training and running generative AI and high-performance computing workloads. Therefore, if demand for AI infrastructure continues to grow, the share price should feel the benefit of this.
Given ChatGPT’s ability to process so much information, it surprised me with its rather generic pick. Nvidia has done incredibly well, it’s up 33% this year. Over the past few years, it has boasted an incredible return. For example, if you had purchased the stock five years back, you’d be up a whopping 1,326%!
However, I can’t say I agree with my AI friend. When I look ahead to next year, there are several reasons why Nividia might not be as exciting as other options.
Scope of further outperformance
Nvidia recently passed an incredible milestone, reaching a market cap of $5trn. This is simply staggering. Yet for the purpose of our discussion, it’s also a bit worrying. The US stock is now so large that it makes it harder to deliver juicy share price gains. For example, a 10% rally would add around $500bn worth of value. Whereas if a stock had a market cap of $50bn, a 10% rally would equate to a $5bn value add. The point is that it’s much harder to add $500bn in value to a company. As a result, it could make it more challenging for Nvidia shares to surge next year.
Another point is competition. The chips being made are indeed the go-to for many clients. However, other companies are catching up, which could eat into market share in the coming year. These include Advanced Micro Devices and Intel. I’d argue these are better growth stocks to consider, as the companies could grow rapidly by taking market share. For Nvidia, it’s going to do well just to maintain its dominant position, rather than expand.
Of course, these are just my views. Nvidia could continue to deliver blow-out returns, fuelled by strong financial results and increased adoption of AI going forward. But in terms of looking for exceptional share price gains, I struggle to see how Nvidia is the most attractive option in the market right now.
