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Nvidia’s Market Value Hits Record $1 5T As AI Powers More Gains

Founded in April 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem, Nvidia exploded in popularity in 2023 as a major player and contributor to the advancement of AI. NVIDIA Corp. (NVDA) designs, develops, and markets graphics processors as well as related software and hardware products. The company has played a pioneering role in the development of the graphics processing unit (GPU), a type of chip or electronic circuit capable of rendering graphics for display on electronic devices. GPUs were originally designed for the PC graphics market and video gaming industry. Founded in 1993, The Motley Fool is a financial services company dedicated to making the world smarter, happier, and richer.

  1. On the bottom line, it posted adjusted earnings per share of $5.40 to $5.55, which was ahead of its prior forecast of $4.40 to $4.88.
  2. The VanEck Semiconductor ETF (SMH -1.44%) is a reasonably large ETF with a higher portfolio weighting to Nvidia (19%), making it a possible alternative for investors seeking passive exposure to the stock.
  3. This puts Jen-Hsun Huang in the top 10% of approval ratings compared to other CEOs of publicly-traded companies.
  4. Decide what percentage of your portfolio should be made up of NVIDIA shares before going to your brokerage.
  5. Nvidia came into a bit of trouble after a report from Citron research at the end of 2016 said the company wasn’t actually gaining new business, just stealing market share from its rival, AMD.
  6. NVIDIA Corporation ranks among the world’s leading microchip manufacturers and is best known for its contributions in the fields of graphics and gaming.

If you’re having trouble deciding on a brokerage, check out Benzinga’s list of the best-ranked online brokers. NVIDIA’s Graphics segment offers GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and software solutions for gaming platforms. Nvidia came into a bit of trouble after a report from Citron research at the end of 2016 said the company wasn’t actually gaining new business, just stealing market share from its rival, AMD. Nvidia stock price stock fell by about 7% after the report. Nvidia stock price quickly recovered however, and continued to march higher. Before joining Finder in 2021, Matt covered everything from finance news and banking to debt and travel for FinanceBuzz.

AMD Analysts Deep Dive Into Q4 Print: ‘Expectations Are Reaching A Fever Pitch’ is one of the hottest stocks in artificial intelligence today. Learn more about the SaaS and whether it’s a good investment. The company believes accelerated computing can help unlock the power of AI. Nvidia’s GPUs power the AI software behind OpenAI’s wildly popular ChatGPT program. NVIDIA currently pays a quarterly cash dividend of $0.04 per share, according to the company’s Q3 FY 2022 earnings press release dated Nov. 17, 2021.

Given its large market cap, Nvidia is among the top five holdings of the five largest ETFs by assets under management (AUM). The SPDR S&P 500 ETF owns the most shares and has a meaningful portfolio weighting among the biggest ETFs. That makes it a solid option for investors seeking exposure to Nvidia stock.

NVIDIA Corporation accelerates computing to help solve the computational problems. Nvidia remains by far the best-performing S&P stock of 2023, dwarfing the next highest returner on the index, Meta (shares up a comparatively meager 170%). The surge for Nvidia, which first went public in 1999, came as Nvidia converted the blossoming interest in AI into tangible revenue and profit growth. Alongside other American tech behemoths, Nvidia has captained a strong bounce-back year for stocks, with the S&P and Nasdaq up 23% and 42% year-to-date, respectively. Nvidia reaffirmed its AI prowess in its third quarter earnings report of 2016. Nvidia stock price rose about 30% after the company nearly doubled analyst earnings expectations.

Nvidia Corporation is a technology company headquartered in Santa Clara, California. The company operates in the technology sector, specializing in graphics processing units (GPUs), artificial intelligence (AI) and high-performance computing. Nvidia is primarily known for its GPUs, which are used in a wide range of applications, including gaming, data centers, autonomous vehicles, professional visualization, edge computing and AI and deep learning.


Just two years after going public, Nvidia was added the the S&P 500 in 2001. The company was the fastest every semiconductor company to reach $1 billion in revenue. Supermicro didn’t offer much of an explanation for the soaring growth, only saying that it had strong market and end customer demand. Investors will likely learn more when plan de trading Supermicro reports its complete second-quarter earnings report after hours on Monday. It is also worth noting that NVDA currently has a PEG ratio of 3.59. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate.

While soaring chip demand is driving NVIDIA’s record financial results, the company still has been concerned about possible shortages because it’s a “fabless company” (see the FAQs section below). Instead, it designs chips and outsources the manufacturing to third-party companies to do the fabrication. NVIDIA could thus still be affected by the shortage if its third-party suppliers cannot manufacture chips fast enough to meet soaring demand. Investors have pinpointed Nvidia as a key AI stock due to its dominance of the market for the graphics processing units (GPUs) that power OpenAI’s bot and other intelligent language tools. On the company’s investor website, lots of information about NVIDIA’s finances is available, along with contact info for the board of directors.

This functionality made them extremely useful for new uses like cryptocurrency mining and training the large language models (LLM) behind generative AI applications. Melius reiterated its buy rating on Nvidia and a $750 target price, a more than 55% upside from its current trading level of $482 apiece. Cramer cited the chipmaker’s knockout quarter as an indicator of further growth prospects, with strength from Nvidia’s networking and software sales, along with its expanding customer base. Those chips — while delivering “a sharp reduction in overall performance” — may appeal to Chinese customers while being more palatable to U.S. regulators,” wrote Bernstein analyst Stacy Rasgon in a November investor note. One of three positive chart patterns to look for when doing technical analysis.

ETFs with exposure to Nvidia

Nvidia’s (NVDA -1.99%) growth thesis hinges on generative artificial intelligence (AI) — a tech megatrend sending demand for its advanced hardware through the roof. And according to analyst projections, this booming market has plenty of room left to run. That said, the company could find even more synergistic growth drivers over the long term. 39 Wall Street equities research analysts have issued “buy,” “hold,” and “sell” ratings for NVIDIA in the last year. There are currently 1 sell rating, 3 hold ratings, 34 buy ratings and 1 strong buy rating for the stock.

Perhaps the analogy between videoconferencing during the Covid-19 pandemic and graphics processing unit chips during a generative AI boom is not a perfect fit. However, after Nvidia stock soared 249% this year as of November 21 — compared to the S&P 500’s 19% jump — investors are beginning to wonder how long the company can keep exceeding such high growth expectations. Profit growth helps drive stock price appreciation over the longer term, making Nvidia an ideal area for beginning investors to focus on before buying shares of any company. The company generated almost $27 billion in revenue and produced $4.4 billion of net income in its 2023 fiscal year.

That’s relatively high compared to, say, the trailing 12-month P/E ratio for the United States stock markets on average as of November 09, 2023 (20.44). The high P/E ratio could mean that investors are optimistic about the outlook for the shares or simply that they’re over-valued. The expanding adoption of AI hardware by software providers, governments and corporate customers gives him confidence GPU demand from “data centers can grow through 2025,” Bloomberg reported.

Nvidia’s Outstanding 2023 Third Quarter Fiscal Performance

The accelerated IO (input/output) of those systems can improve performance by 20% to 100% for intensive workloads. However, Nvidia wasn’t the top performer in the entire stock market. One of the handful of companies that beat it was a little-known AI stock called Super Micro Computer (SMCI 3.24%).

The company has become the powerhouse of the semiconductor industry with its strong product line and frequent earnings beats. NVIDIA GPUs can be found anywhere from video game consoles to deep-learning AI systems. When, in 2004, the SLI connection standard was released, Nvidia saw a huge bump in the processing power it could achieve on a single machine.

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