The USA Leaders
Monday, June 17, 2024
California – Nvidia (NVDA) stock has been on a tear. Up 42% in just one month (May 17th – June 14th), and an incredible 163% in the last six months, it even surpassed Apple’s market cap in early June, briefly becoming the world’s second-most valuable company with a staggering $3.244 trillion valuation. This meteoric rise comes on the heels of a near 800% surge since the beginning of 2023, fueled by the explosion of artificial intelligence (AI). Therefore, this meteoric rise has sparked a debate – is Nvidia stock overvalued, or is it a reflection of the company’s true potential in the AI era?
Nvidia’s graphics processing units (GPUs), once the domain of video game graphics have become the cornerstone of generative AI, propelling the company to new heights.
To accommodate this growth, Nvidia announced a 10-for-1 stock split in May, further boosting investor confidence. Since then, the stock has climbed another 25%, adding nearly $1 trillion to its market cap. Now, with the split complete, investors are left wondering: is this the peak, or is Nvidia poised for even greater things?
While some analysts point to a high Relative Strength Index (RSI) of 80, indicating the stock might be “overbought” and due for a correction, others see this as a mere blip on the radar. Nvidia’s leadership in AI chip manufacturing is undeniable, and the company has a laundry list of upcoming announcements expected in the coming months. These announcements speculated to include advancements in AI, self-driving cars, and the metaverse, could propel the stock even further.
The question remains: is $131 a bargain basement price for a company at the forefront of technological innovation, or is a correction looming? Only time will tell. However, one thing is certain: with its dominance in AI and a roadmap packed with potential breakthroughs, Nvidia is a company to keep a close eye on. The future could be truly BIG for this tech giant.
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