Since going public in 1999, American tech company Nvidia’s stock has surged a whopping 212,000% by 2023. Nvidia's initial public offering (IPO) took place on January 22, 1999, with shares priced at $12 each. The company underwent four stock splits, three of which were 2-for-1 and one was 3-for-2.
Nvidia is known for designing GPUs, APIs for data science, and SoCs for mobile and automotive markets. They're a major player in AI hardware and software, with their GPUs being used in various fields like architecture, engineering, entertainment, and more.
Founded on April 5, 1993, Nvidia was established by Jensen Huang (current CEO), Chris Malachowsky, and Curtis Priem. The trio, with backgrounds in engineering from companies like LSI Logic, Sun Microsystems, and IBM, started the company after a meeting at a Denny's (a breakfast place) in East San Jose.
With an initial capital of $40,000, the company was established. Later, Nvidia secured $20 million in venture capital from investors like Sequoia Capital. Initially, the co-founders used "NV" for their files, standing for "next version," as the company had no official name. The search for a name led them to "invidia," the Latin term for "envy." The original headquarters of Nvidia was located in Sunnyvale, California.
If you invested $10,000 during Nvidia's IPO, your investment would have been worth $19.5 million now.
If you had invested $10,000 at the IPO price, you would have owned 833 shares initially, which would have grown to 9,996 shares after the splits. With the current stock price hitting an all-time high of $499, the value of that investment would now be around $49,43,620. With a YTD gain of over 230%, Nvidia is the best-performing S&P 500 index currently.
During its 24-year journey, Nvidia's stock dropped over 50% 12 times and a whopping 90% twice. The investors who braved those drawdowns would have made a killing eventually.
Nvidia's quarterly revenues reached $13.51 billion in Q2, a remarkable increase of over two times compared to the same quarter the previous year. This figure significantly exceeded the projected $11.22 billion forecasted by analysts and even surpassed the most optimistic predictions.
Upon revealing impressive earnings, the semiconductor manufacturer disclosed its intention to repurchase $25 billion worth of its stock. Analysts currently anticipate a cash flow of $34.4 billion for the upcoming year. Therefore, if the company intends to allocate over 50% of this amount towards buybacks, the total repurchased could approach the $20-billion mark.
Nvidia's present average brokerage recommendation (ABR) stands at 1.13 within a scale ranging from 1 to 5, signifying the evaluations provided by 36 brokerage firms, encompassing designations such as Buy, Hold, and Sell. This ABR value of 1.13 falls within the range between a Strong Buy and a Buy rating.
Nvidia has entered the league of companies that are valued over $1 trillion, driven by the momentum of technology enterprises, both large and small, in their pursuit to integrate generative AI tools into their offerings. Nvidia's chips have solidified its role as a crucial supplier for companies striving to incorporate AI capabilities into their projects.
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