Nvidia Trillion Dollar Company: First Chip Stock to Reach $1 Trillion
Nvidia become the world’s biggest maker of the specialized chips needed to power a new generation of AI products now Nvidia is trillion dollar company. And surpassing Advanced Micro Devices Inc. and Intel Corp. joining the ranks of just five American companies with valuations that high. AI took center stage after Nvidia stunned investors with a revenue forecast. Last week that surpassed analysts’ expectations by more than 50%.
The gaming and AI chip company, whose shares rose 4.2% in early trading on Tuesday, was valued at $1 trillion.
Meta Platforms Inc, valued at about $670 billion as of last close, clinched the trillion-dollar market capitalization milestone in 2021. While Apple Inc, Alphabet Inc, Microsoft Corp, and Amazon.com Inc are the other U.S. companies that are part of the club.
Wall Street analysts called Nvidia’s forecast “unfathomable” and “cosmological”, hiking their price targets in droves. The highest price target valued the company at about $1.6 trillion.
“Given the valuation is well above the long-term average, there will be significant pressure to deliver high growth on a consistent basis. There could be volatility in its share price to come,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
“Nvidia is the poster child for AI at the moment,” said Thomas Hayes, chairman at Great Hill Capital. Then said, “The market is coming to terms with if this AI trend is real.” It has become the world’s biggest maker of the specialized chips needed to power.
Nvidia’s shares rose about 25% last week sparking a rally in AI-related stocks. And boosted other chipmakers and Nvidia become trillion dollar company. Helping the Philadelphia SE Semiconductor index close on Friday at its highest in over a year.
With fingers in a lot of pies, with access to dozens of technologies. Nvidia’s software market also seeped in its investments in AI and research, which have borne several industry-shattering technologies. The software market appears to be at least ‘three times larger than that for gaming’. Which is particularly notable in the gaming segment of Nvidia’s proposition. Currently account for ‘45% of Revenue’ states Chris Caso, a Raymond James analyst.
