A recent analysis identified the seven best big company stocks to consider for investment, with NVIDIA Corporation (NASDAQ:NVDA) being evaluated among these prominent firms. Mega-cap stocks, particularly in the technology sector, have been significant drivers of U.S. stock market returns. Experts indicate that from the beginning of 2023 through the end of May 2024, a handful of major tech companies contributed approximately 60% of the S&P 500’s gains, which exceeded 40%.
As reported by FactSet, around 79% of S&P 500 companies that released earnings for the second quarter of 2024 exceeded expectations for earnings per share (EPS), while about 60% surpassed revenue projections. Notably, the stocks of semiconductor companies led the S&P 500 Index, supported by the growing demand for AI, particularly impacting sectors such as utilities tied to increased electricity consumption for AI data centers.
Looking ahead to the third quarter of 2024, analysts on Wall Street foresee a decline in earnings estimates, with cuts reportedly larger than those observed in the first part of the year. Current expectations suggest that S&P 500 earnings will increase by 3.9% year-over-year alongside a revenue growth of 4.7%. This figure has decreased from an initial projection of 6.9% at the start of July.
The downward adjustment in forecasts is attributed to various concerns, including economic slowdowns, persistent inflation challenges, sustained high interest rates, and escalating geopolitical tensions. Among these factors, uncertainties surrounding the upcoming U.S. presidential elections are viewed as particularly influential.
According to a report by Reuters, the increasing polarization and the competitiveness expected in the election could lead to a rise in the economic policy uncertainty index (EPU), which reflects consumers delaying spending and businesses halting investment when government policy outlooks are unclear.
Brandywine Global Investment Management has noted that the current political climate is affecting consumer confidence, as reflected in the University of Michigan’s surveys. Past research indicates that the EPU index typically rises significantly during presidential election months, particularly in closely contested races.
With this backdrop, investors are encouraged to focus on established big company stocks during this turbulent period. Analysts emphasize that the ongoing election cycle is influencing consumer behavior, which in turn impacts corporate performance.
A JPMorgan survey highlights that political risks, both domestic and international, are seen as major destabilizing factors in equity markets. Despite concerns, the positive momentum fueled by AI advancements and strong earnings in early 2024 has largely benefited technology and growth industries. Investors are also hopeful that sectors lagging behind will eventually catch up, following the surge in tech stocks.
For the selection of the seven best big company stocks, a methodology was employed using stock screeners to filter for market capitalization and popularity among hedge funds, with rankings reflecting hedge fund sentiment.
Focusing on NVIDIA Corporation (NASDAQ:NVDA), the company is recognized as a leader in graphics processing units (GPUs) crucial for various markets, including gaming, data centers, and automotive systems. NVIDIA has significantly invested in software enhancements to optimize its hardware performance. Anticipating revenue of approximately $32.5 billion for the third quarter of 2025, NVIDIA also returned $15.4 billion to shareholders in the first half of 2025 through buybacks and dividends.
Analysts at JPMorgan upgraded their price target for NVIDIA’s shares to $155. The firm’s recent analysis pointed out NVIDIA’s dominance in key growth areas such as AI and machine learning, citing strong sales driven by rising demand in data center technology.
Overall, NVIDIA ranks fifth in this list of the best big company stocks to invest in, with some analysts suggesting that other undervalued AI stocks might offer greater potential for quicker gains.