Nvidia soaring market cap nears Amazon and Alphabet, fueled by surging AI demand

[Shawn Knight]

Jackpot baby! Artificial intelligence has proven incredibly fruitful for Nvidia and its shareholders over the past year, and could even help the chipmaker surpass Amazon in terms of total market capitalization. Closing at over $720 today, that's an increase of more than 20% year over year and nearly 50% since the beginning of 2024.

Update (Feb 12): Nvidia stock keeps on rising. Today it briefly passed both Amazon and Alphabet.

Nvidia is officially the 4th largest company in the world by market cap

It passed BOTH Amazon and Alphabet this morning with shares up 2.5%

The show goes on pic.twitter.com/eFp3U9SQtu

– Morning Brew �*ï¸Â (@MorningBrew) February 12, 2024

Nvidia shares closed at $223.37 a year ago today. It is a respectable figure, but was down about $50 compared to where the stock sat in early February 2022. Today, it is trading at $721. That is an increase of more than 221 percent year over year and up nearly 50 percent since the start of 2024.

Nvidia's market cap currently sits at $1.77 trillion, which is not far behind Amazon's cap of $1.81 trillion or Alphabet at $1.86 trillion. Tech titan Apple is currently valued at $2.92 trillion, well ahead of most of its peers.

Those holding on to shares purchased prior to 2020 are no doubt having a hard time wiping the grin of their face. Back then, you could pick up shares of Nvidia for around $50 each.

Earlier this week, Morgan Stanley raised its Nvidia stock price target from $603 per share to $750 per share, spurring recent gains. Analysts said that although wait times are coming down, developers are still facing long waits in order to train models using Nvidia hardware from cloud providers.

Nvidia has been selling AI-capable hardware as fast as it can make it, but is not the only one benefitting from the AI race. Last month, Microsoft overtook Apple as the most valuable company in the world. As of writing, Microsoft's market cap sits at $3.12 trillion with shares trading at $420.22 apiece.

Other tech firms in the top 10 that have not already been mentioned include Meta at number seven with a market cap of $1.19 trillion and TSMC in 10th place at $693.8 billion. Tesla and Broadcom reside just outside the grouping at 11 and 12, respectively, with valuations of $615.17 billion and $600 billion.

Nvidia's next quarterly earnings report is due out on February 21.

Image credit: Elias Gamez

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https://www.techspot.com/news/101836-nvidia-soaring-market-cap-nears-amazon-alphabet-fueled.html

 

[Thatsdisgusting]

This is ridiculous.


Even if you put it in a way that a real company with “real deal material making” surprass bezos’s bazar company, you still don’t feel happy. Somehow…

 

[kiwigraeme]

This is ridiculous.


Even if you put it in a way that a real company with “real deal material making” surprass bezos’s bazar company, you still don’t feel happy. Somehow…

I really don't have a problem with these type of valuations . The weirdest ones are IPO startups , that are huge money holes , not close to profit having these market caps at launch greater than many famous companies with real products , real profits, real estate . To make it even seem stranger than don't have a monopoly on an idea - ie any other company could come in a do x & y on the internet or with an app . Often it's just we do it all on the web , as opposed to companies already doing it in offices and on the web .
*****s who want to buy those 50 Billion dollar cap crap long term are welcome to throw away their money

 

[Theinsanegamer]

This valuation is absolutely WILD compared to nvidia's profits.

Getting some real strong 2008 vibes. The market has so much cash flowing through it based on absolutely nothing.

 

[RudyBob]

Making pantloads of dough and won't sell a vidcard at am affordable price.

 

[Lounds]

S&P 500 is entirely being propped up by the big 7 tech companies. Eventually companies will start to go bust and investors will have to plug holes if the portfolios and the tech bubble will pop. This is 100% the peak for Nvidia and the only way is down imo. QT on the rise and I can only see Nvidia growing again if the QE tap is turned back on.

 

[Atmajaya2020]

When I first started building PC games, I just thought Nvidia was just a small gpu card manufacturing company...
never thought that Nvidia would become one of the companies with the largest market caps..

 

[redgarl]

AMD is next.... chip makers are going to conquer the world in 5-10 years.

 

[gamerk2]

This valuation is absolutely WILD compared to nvidia's profits.

Getting some real strong 2008 vibes. The market has so much cash flowing through it based on absolutely nothing.

Its based on future expectations. With AI being a growing, in demand field, and NVIDIA by far the leader, the investors expect a ton of profits in the future.

 

[toooooot]

Making pantloads of dough and won't sell a vidcard at am affordable price.

Us and Nvidia are like two people who dated during its poor years. But then one of us, Nvidia, became rich and famous and found someone more suitable for its status.
Occasionally, it waves us and throws a couple of overpriced gps our side.
But it barely needs us anymore.

 

[Theinsanegamer]

Its based on future expectations. With AI being a growing, in demand field, and NVIDIA by far the leader, the investors expect a ton of profits in the future.

That doesn't justify a market cap more then 100x yearly profit. That valuation is a house of cards. Great so long as nobody questions why it's that much.

 

[gamerk2]

That doesn't justify a market cap more then 100x yearly profit. That valuation is a house of cards. Great so long as nobody questions why it's that much.

Valuation is based on the expectation of future value. If you think the stock is going to go up compared to the current price, then you buy. Simple as that.

Actual "value" has nothing to do with how a stock is priced. Its "expectation" that matters.

 

[Thatsdisgusting]

Smart ppl and “clever papers” tend to see some dotcom’99 vibes rather than 2008. Dunno if now is a bit better or far worse though…