The market capitalization is soaring, 3.34 trillion US dollars! Nvidia surpassed Microsoft and Apple in one fell swoop and topped the "world stock king"! Analysts are bullish on an upside of $5 trillion

National Business Daily

2024-06-19 07:42Published on the official account of Sichuan Daily Economic News

U.S. stocks on Tuesday, the global capital market ushered in a key milestone: after the stock price rose 300 times in the past decade, AI leader Nvidia (NVDA. O) finally ascended to the throne of "global stock king".

Nvidia weekly chart, source: TradingView

According to Yicai, Nvidia's stock price has soared by more than 200% in the past year, but one of the most optimistic analysts believes that the semiconductor giant's market has not yet come to an end, and its market value is expected to climb to nearly $5 trillion next year. Rosenblatt Securities analyst Hans Mosesmann raised the chipmaker's price target to a high of $200 from $140 on Tuesday. Nvidia rose 4.1% on the day, hitting a new intraday high and becoming the world's most valuable company. Mosesmann has given the stock a buy rating since it began focusing in 2017. He said he is optimistic about Nvidia's hardware products, but pointed out that the combination of Nvidia's software and its hardware is the real highlight of the company.

Nvidia surpassed Microsoft and Apple in one fell swoop

Become the world's most valuable company

At the close of the U.S. stock market on June 18, local time, Nvidia became the world's most valuable company, with its share price rising 3.51% to $135.58 and a new all-time high, with a total market capitalization of $3.34 trillion, surpassing Microsoft and Apple in one fell swoop.

Nvidia surpassed its $3 trillion market cap for the first time earlier this month and managed to overtake Apple. This leap in market capitalization once again proves the market potential of AI technology and the great interest of investors.

It took 96 calendar days (calendar days) for Nvidia's market capitalization to rise from $2 trillion to $3 trillion. By comparison, according to Bespoke Investment Group, it took Microsoft 945 days and Apple 1,044 days.

Nvidia's stock price has grown more than ninefold since the end of 2022, and as of the close on Monday, June 16, the stock has soared 164.5% this year. This growth is driven by its dominance in the AI chip market, especially in the AI chip market used in data centers, where Nvidia has a share of about 80%. With the massive demand for processors from companies such as OpenAI, Microsoft, Alphabet, Amazon, Meta, and others, NVIDIA's business has grown rapidly.

Despite the rapid growth in Nvidia's market capitalization, the company has yet to be included in the Dow Jones Industrial Average, a benchmark index of 30 stocks that historically includes the most valuable companies in the United States. Last month, with the earnings released, Nvidia announced a 10-for-1 stock split, which went into effect on Jan. 7. The split will increase the likelihood of Nvidia's inclusion in the Dow Jones index, which is a price-weighted index where companies with higher share prices have more influence over the benchmark index.

After Nvidia completed a 1-for-10 stock split on June 10, Hans Mosesmann, an analyst at Rosenblatt Securities, said on Tuesday that Nvidia will extend its rally, with a market capitalization of nearly $5 trillion in the coming year, and Mosesmann raised Nvidia's price target from $140 to $200, which is equivalent to nearly 52.7% upside from Monday's close. And this price has become the highest price on Wall Street at the moment. Mosesmann has been tracking Nvidia stock since 2017 and has been bullish on the company's hardware products. In particular, he emphasized that the combination of NVIDIA's software and its hardware is the company's real highlight.

Last month, Nvidia announced results for the first quarter of fiscal year 2025 that exceeded expectations, of which data center business revenue reached $22.6 billion, an increase of 427% over the same period last year, and once again hit a record high; Total revenue recorded US$26.04 billion, an increase of 262%; Net profit reached US$14.88 billion, an increase of more than 6 times.

Huang once mentioned that Nvidia is not just a chip company, but an AI supercomputer company, an AI infrastructure company, and an AI factory company, which is also what makes Nvidia special. At this point, many investment banking analysts also resonate with him.

Daniel Ives, an analyst at Wedbush Securities, noted in the report that he believes Nvidia, Apple and Microsoft will be the focus of the $4 trillion market capitalization of the technology industry in the coming year. As the Fourth Industrial Revolution advances, businesses and consumers are increasingly demanding these chips, and Nvidia's GPU chips are essentially the new gold or oil in the tech sector.

Michael Lippert, vice president and portfolio manager at Baron Capital Inc., emphasized in an interview that Nvidia is more than just a chip sales company, they also offer systems, and the company's proprietary software and development ecosystem is a factor in its success.

Daniel Ives, managing director of Wedbush Securities, predicted in an interview with the Daily Economic News: "In the next year, Apple, Microsoft and Nvidia will compete fiercely around a market capitalization of $4 trillion. "While Microsoft is seen as having a head start in generative AI, while Apple has previously lagged behind in AI, Wall Street's perception of Apple is shifting.

The three major U.S. stock indexes all closed slightly higher, with the S&P 500 up 0.25%, the Dow up 0.15%, and the Nasdaq up 0.03%. Among them, the Nasdaq and S&P 500 indexes continued to hit record highs, and the Nasdaq index continued to hit new closing highs for seven consecutive trading days.

Most of the large technology stocks fell, Tesla, Google, Meta, and Intel fell more than 1%, and Microsoft and Amazon fell slightly; Netflix rose more than 1%.

The settlement price of international crude oil futures rose by more than 1%. WTI crude oil futures for July delivery closed up $1.24, or 1.54%, at $81.57 a barrel. Brent crude oil futures for August delivery closed up $1.08, or 1.28%, at $85.33 a barrel.

NVIDIA open source

On June 14, local time, NVIDIA open-sourced the Nemotron-4 340B (340 billion parameters) series model.

According to NVIDIA, developers can use the models to generate synthetic data that can be used to train large language models (LLMs) for business applications in healthcare, finance, manufacturing, retail, and other industries. Nemotron-4 340B consists of the base model, the instruction model, the Instruct, and the reward model. Nvidia used 9 trillion tokens (text units) for training.

Nemotron-4 340B-Base在常识推理任务，如ARC-c、MMLU和BBH基准测试中，可以和Llama-3 70B、Mixtral 8x22B和Qwen-2 72B模型媲美。

Huang sold 240,000 shares in two days

Cashed out 226 million yuan

On Monday, June 17, Eastern time, Nvidia also had heavy news: the company's CEO Jensen Huang sold Nvidia shares again after 9 months. According to the latest regulatory filings, Huang cashed out $31.2 million (about 226 million yuan) through a series of insider transactions and sold 240,000 shares on June 13~14.

According to a regulatory filing from Nvidia cited by Barron's, Huang launched the so-called 10b5-1 rule trading program on March 14 this year, and he will sell no more than 600,000 shares of Nvidia stock by March 31, 2025. The 10b5-1 plan automatically executes stock trades when pre-set conditions such as price and volume are met, which is designed to eliminate any advantage that company insiders may have from knowing material non-public information.

The reporter of "Daily Economic News" also noted that since May 24, Nvidia has disclosed 13 "Form 144 documents" to the SEC. This type of disclosure is a specific document involving the reduction of directors, supervisors and senior executives of a U.S.-listed company, and will only be disclosed when a specific person reduces his or her holdings by more than 5,000 shares, or the total amount involved exceeds $50,000.

除了黄仁勋外,英伟达执行副总裁Deborah Shoquist也于2024年6月3日出售了41140股股票,套现超过4500万美元。 其他减持套现的英伟达高管还包括Dawn Hudson、Tench Coxe、John Dabiri、Michael McCaffery、Brooke Seawell和Mark Stevens,他们在最近几周也出售了不同数量的英伟达股票。

However, it should be noted that as of March 25, 2024, Huang held nearly 93.5 million shares of Nvidia, accounting for 3.8% of Nvidia's total share capital. In other words, his recent reduction of 240,000 shares is just a drop in the bucket compared to his total holdings.

Disclaimer: The content and data of the article are for reference only and do not constitute investment advice. Investors act accordingly at their own risk.

Editor|Cheng Peng, Du Hengfeng

Proofreading|Liu Xiaoying

Cover image source: Visual China (data map unrelated to picture and text)

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