Nvidia recently hit a huge milestone, reaching a market value of $5 trillion. Experts say this is more than just a number; it shows Nvidia has moved from just making chips to actually creating an entire industry.
Matt Britzman, an analyst at Hargreaves Lansdown, believes that even at $5 trillion, the stock isn’t too expensive. He says the market still doesn’t fully grasp how big the opportunity is, and Nvidia remains one of the best ways to invest in the AI trend. Kim Forrest, a chief investment officer, agrees, stating that the “great AI bubble” doesn’t seem close to bursting. She points out that Nvidia makes the essential parts driving the AI revolution, and there’s a huge demand for new data centers, all of which rely on Nvidia.
Russ Mould, an investment director at AJ Bell, noted that Nvidia has added $2.5 trillion to its market value since April, more than doubling its stock price. He mentioned that talks of trade deal exemptions and potential good news from an upcoming Asian summit could further boost investor confidence.
Michael Brown, a senior research strategist, highlighted that everything has gone right for Nvidia lately, with new partnerships and strong forecasts from CEO Jensen Huang, who expects $500 billion in business over the next five quarters. Brown believes continued large spending on data centers by big tech companies will keep Nvidia’s rally going.
Arthur R Hogan III, chief market strategist at B. Riley, emphasized that this milestone confirms Nvidia as the clear leader in the AI revolution. He pointed out that Nvidia’s growth comes with reasonable stock prices, trading at 35 times next year’s earnings with impressive 70% profit margins. Hogan believes the $5 trillion valuation, though historically massive, is deserved given Nvidia’s consistent strong performance, smart deals with key industry players, and ability to handle tough political situations.
Daniela Hathorn, a market analyst at Capital.com, attributes Nvidia’s rise to broader market excitement and solid economic fundamentals, such as easing inflation. She also stressed that the AI boom isn’t a bubble because real company earnings and growth back it. Hathorn sees significant potential for additional partnerships and international expansion, which will help ease concerns about market volatility. She also suggested that while some political moves might involve costs for Nvidia, the company doesn’t rely on political backing to generate revenue; it just needs politicians not to get in the way. Ultimately, experts believe Nvidia’s success is the result of CEO Jensen Huang’s long-term vision, making it the clear leader of today’s tech boom, much as Microsoft and Intel led the PC era.
