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It's no secret that computer game chip maker turned artificial intelligence prodigy Nvidia (NVDA) has had a fantastic year, but for investors the party may have just begun.

“The revenue monetization opportunity is so much greater (than investors appreciate),” Bank of America analyst Vivek Arya told Yahoo Finance Editor-in-Chief Brian Sozzi on Yahoo Finance’s Opening Bid podcast (video above; listen below).

“At this point they are truly a systems integrator,” Arya added. “They sell complete racks with all the computing power, the networking, the optical resources, the storage and everything.”

The leading semiconductor analyst just caused a stir in the market with his recent call on Nvidia.

He raised his earnings per share estimates for 2024 and 2025, citing likely strong demand for his new Blackwell chip. Demand for Nvidia's previous AI chip – Hopper – remains hot, Arya said. With that in mind, Nvidia stock is still cheap, trading at a forward price-to-earnings ratio of 37, according to Arya.

With the company expected to generate a whopping $200 billion in free cash flow over the next two years, Arya says the stock also looks cheap from a price-to-cash flow ratio perspective.

Arya sees at least 40% more upside potential in Nvidia stock. Shares are already up 190% year-to-date and are near records despite an 18% rise in October.

Shares of rival AMD (AMD) are up just 5% year over year as performance specifications for the company's AI chip released a few weeks ago disappointed investors.

Meanwhile, Intel (INTC) continues to endure one of the worst periods of its existence, marked by layoffs and substandard products. Shares are down 55% this year.

The main drivers for Arya's bullish Nvidia assessment (alongside less bullish views on Intel) include its upcoming next-generation AI chips – Blackwell Ultra, Rubin and Rubin Ultra. According to Arya's analysis, these offerings will hit the market in the third quarter of 2025.

“Everyone is in a race,” Arya said of expanding the country’s AI infrastructure. Arya envisions a scenario where OpenAI and companies like Meta (META) drive the market with open structures and cloud companies act as intermediaries. That only increases the need for Nvidia's best-in-class chips.

“This is a real and persistent demand backdrop,” C3.ai (AI) CEO Tom Siebel said at the opening offering.

“When it comes to AI broadly, I think this is a world-changing change,” Siebel said. “It’s not temporary. It’s a really big deal.”

The story continues