Nvidia (NASDAQ: NVDA) has been one of the hottest stocks on the market in 2023, with eye-popping gains of 235%. That impressive surge is justified thanks to the astronomic acceleration in the chipmaker's top and bottom lines on the back of booming demand for artificial intelligence (AI) chips.

However, the big pop in Nvidia stock this year inflated its valuation. It is now trading at 27 times sales, which is higher than its five-year average price-to-sales ratio of 20. The trailing earnings multiple stands at 65.

While Nvidia seems capable of justifying that valuation thanks to its dominant position in the market for AI chips, which is likely to translate into terrific growth in 2024, investors may be looking for a cheaper alternative to capitalize on the proliferation of AI.

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Source Fool.com