The bull market recently raced into its third year, as the S&P 500 and the Nasdaq each surged to new record highs in 2025. Technology stocks, particularly those well-positioned in the artificial intelligence (AI) market, have been powering this momentum. Why AI? Because this newish technology promises to revolutionize the way tasks are done — from the simplest to the complex — and result in great efficiency and innovation for companies. Investors are betting that will result in earnings growth and stock price performance — and it already has for many.
The big question now is how long this movement will last. Well, history has some good news for us. A look at the 11 bull markets since World War II shows us the average length is more than five years, according to research by Ryan Detrick, chief market strategist at Carson Group. Detrick also points out that the average bull market in this time period has delivered an increase of more than 191% — considering that over the past three years the S&P 500 has climbed about 70%, the current bull market may have plenty of room to run.
All of this suggests the Nasdaq, powered by some of today’s biggest growth stocks, may soar in 2026. Here’s the one AI stock to buy before it does.
Image source: Getty Images.
This particular company is so essential to the field of AI that it represents a clear no-brainer bet on the industry. If AI demand continues as expected, it’s very likely this player will score a major win. The company I’m talking about is Nvidia(NASDAQ: NVDA), the world’s biggest AI chip designer.
So, first, let’s talk about what this player has accomplished so far. Nvidia has built this AI empire because it had the foresight to get in on the space early, allowing it to develop leadership, and the company also rapidly expanded into a variety of AI products and services. This made it the “go-to” choice for the AI customer searching for the best and most complete platform.
All of this has resulted in mind-blowing earnings growth, with revenue and net income soaring in the triple-digits in the latest full year. And in recent quarters, the company has delivered double- and triple-digit earnings growth.
Still, you may look at Nvidia’s 1,000% gain over the past three years and wonder if it really represents a growth bet moving forward. After all, it’s much more difficult for a player to grow from these levels — from an earnings and share price perspective — than from the lower levels of a few years ago.
Though Nvidia may not surge to the same extent that it did in the past in a very short period of time, this company still has what it takes to offer investors significant growth. In the latest quarter, Nvidia’s revenue growth accelerated, and the company spoke of surging demand for its chips. On top of this, its biggest customers, from Microsoft to Alphabet, spoke of demand from their customers for compute — this implies they will continue to turn to Nvidia for chips to meet that demand. And the fact that these are companies with solid earnings track records suggests they have what it takes to continue investing.
It’s also important to consider the phase of AI we’re in now and what’s ahead. Today and over the next few years, AI customers are scaling up their platforms. Nvidia chief Jensen Huang predicts AI infrastructure spending might reach $4 trillion in five years. As this unfolds, customers will start to actually apply AI to their needs — and this will continue well into the future. Nvidia’s chips are central to all of this, powering the training of models and then fueling them as they do their job of solving problems. Meanwhile, Nvidia innovates on an annual basis to maintain its leadership position.
Nvidia, trading for 38x forward earnings estimates, may not be the cheapest AI stock around, but it’s worth the premium due to all of the points I’ve mentioned above. And if history is right and the Nasdaq soars in 2026, Nvidia could lead the way — that makes it an excellent buy right now.
Finally, even if history is wrong, the great news is that Nvidia, thanks to its AI leadership, still could deliver impressive growth over the long term.
Before you buy stock in Nvidia, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $540,587!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,118,210!*
Now, it’s worth noting Stock Advisor’s total average return is 991% — a market-crushing outperformance compared to 195% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
