Nvidia is once again nearing its all-time high stock price, having closed at $132.65 per share on October 9—just 2% shy of the record $135.58 set in June. Yet, some analysts contend that Nvidia’s stock remains undervalued.

In a recent interview, Ian Simm, founder and CEO of Impax Asset Management in London, which oversees $50 billion in assets, shared his perspective on Nvidia’s market position. Simm recognized a prime investment opportunity when Nvidia experienced a significant sell-off earlier this year, a move aimed at correcting earlier mistakes that led to missed profitable opportunities.

“We underestimated the market potential of their products,” Simm admitted. He explained that while Impax had always been interested in Nvidia, the stock seemed “expensive” until it dropped. As Nvidia’s price fell in June, Impax capitalized on the moment, increasing its stake to 4.9 million shares by the end of June, more than doubling its previous holdings of 1.4 million shares at the end of the first quarter.

Earlier this year, Nvidia’s stock faced a sharp decline, causing its market cap to drop close to $1 trillion. However, most of those losses have since been recuperated. Simm believes that Nvidia’s current market cap of over $3.2 trillion still doesn’t reflect its true value, especially as demand for Nvidia chips is anticipated to surge alongside the booming AI sector.

From an environmental perspective, Simm argues that investing in Nvidia is not only financially sound but also beneficial to the planet. As global energy demands rise, companies like Nvidia, which are working on more energy-efficient models, play a crucial role in environmental sustainability.

Nvidia recently announced that its forthcoming Blackwell chip will only require 3 GW of power to develop OpenAI’s GPT-4 software. In comparison, a similar process would have needed a staggering 5,500 GW just a decade ago.

“The energy efficiency that Nvidia can achieve certainly adds to the company’s value,” Simm noted.

Currently, investors appear less concerned about potential delays in shipments of Nvidia’s Blackwell chip and are instead focused on the company’s ongoing investments in AI. A research report from JPMorgan Chase on October 8 highlighted that “Nvidia alone is expected to generate $175 billion in revenue next year, with a consensus estimate rising to $225 billion by 2027. When factoring in the overall tech hardware supply chain, R&D, and other operational costs, total AI spending could reach as much as $1 trillion.”