On Wednesday, Nvidia’s shares rose 2.5 per cent, closing with a market capitalization of about US$1.83 trillion, edging past Alphabet’s value of roughly US$1.82 trillion. This milestone makes Nvidia the world’s fourth-most valuable company, with Saudi Aramco, valued at about US$2 trillion, looming as the next target.
Nvidia’s rally has been relentless in 2024, with the stock climbing about 49 per cent and adding approximately US$602 billion in value. This surge has been driven by the soaring demand for its accelerators that power data centres running complex computing tasks required by artificial intelligence (AI) applications.
While other big tech shares have performed well this year, Nvidia’s rally has outpaced them significantly. The company is scheduled to report its earnings on February 21, and analysts are expecting another strong report.
Wall Street is bullish on Nvidia’s prospects, citing signs of continued robust demand for its AI H100 accelerators. The chip maker’s sales have been buoyed by AI spending at its biggest customers, including Microsoft and Meta Platforms.
At least five brokers have raised their price targets for Nvidia this month, and analysts, on average, have boosted their 2024 revenue estimates by more than 100 per cent over the last 12 months. While the AI frenzy has benefited tech stocks linked to the technology, Nvidia stands out as one of the few firms to have demonstrated significant revenue growth from AI.
(Source: Bloomberg | CNBC | The Verge)
