Missed Out on Nvidia Stock? Buy Celestica Stock Instead

Nvidia stock (NASDAQ:NVDA) has certainly been the heavy hitter of 2023 and 2024, but this stock has grown even more than the big chip stock!

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If one stock has seen intense expansion during the last year, it’s Nvidia (NASDAQ:NVDA). Shares of the company are up by a whopping 222% in the last year alone as of writing. And it’s now surging back towards 52-week highs, with sights on US$1,000 per share.

However, many of us have already missed out on the intense share growth of Nvidia stock. But that doesn’t mean we’ve missed out on growth completely. So let’s look at why Nvidia stock has been such a strong growth stock this year. Furthermore, we’ll explore a company that investors can piggyback on instead.

Why Nvidia stock surged

The main reason Nvidia stock grew so much, so quickly, is related to semiconductors. Specifically, the reliance of semiconductors for the faster internet speeds needed for artificial intelligence is growing. Nvidia stock has become a key player in the semiconductor industry, particularly in the realm of graphics processing units (GPUs) and artificial intelligence technology. Its stock has indeed experienced significant growth, especially in recent years, due to several factors. 

Nvidia initially gained prominence for its GPUs, which are essential components in gaming, professional visualization, and data centres. The company’s GPUs are known for their high performance, energy efficiency, and versatility, making them favoured by gamers, researchers, and developers alike. 

Nvidia’s GPUs have found extensive application in artificial intelligence and machine learning tasks. Their parallel processing capabilities are well-suited for handling the large datasets and complex computations involved in AI training and inference. This has led to Nvidia’s GPUs being widely adopted in data centres for tasks like deep learning, neural network training, and inference, driving significant revenue growth.

While the company continues to hold a leadership position in the area of GPUs and semiconductors, it’s not the only one providing growth. Hence why investors should consider also looking at Celestica (TSX:CLS).

Celestica stock: the next winner?

Shares of Celestica stock have already been a clear winner in the last year thanks to its relation to Nvidia stock. The company is  global leader in the design, manufacturing, and supply chain solutions for a variety of industries, including technology, aerospace and defence, healthcare, and industrial. 

While Celestica operates in the broader technology sector, its focus is primarily on providing electronics manufacturing services (EMS) and supply chain solutions rather than designing and producing semiconductor chips like Nvidia stock. So while Celestica’s core business is not semiconductor manufacturing, it still operates within the broader technology industry.

As such, Celestica stock’s performance can be influenced by trends in semiconductor demand, including the increased demand for chips seen in recent years. If semiconductor companies like Nvidia experience strong growth and increased demand for their products, it could have positive effects on Celestica’s business through increased orders for electronic components or manufacturing services.

Shares of the company have already seen an increase on the back of more orders and its relation to Nvidia stock. Shares are up a whopping 339% in the last year alone, even more than Nvidia stock! And yet it trades at just $65 per share, rather than almost US$1,000. So if you want a winning growth stock that’s due for more, consider Celestica stock on the TSX today.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Nvidia. The Motley Fool has a disclosure policy.

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