Investors Bullish on NVIDIA stock before earnings result, Optimism or AI Bubble?

NVIDIA Corp has risen to a new all-time high ($480.88) today (8.34%) after a high bullish sentiment from investors, including the futures market. It's not a coincidence but a deep confidence that stocks rose by 8.34%, just a day before the NVIDIA quarterly earnings are due to be released on 23 August 2023.

NVIDIA stock price history

NVIDIA stock has risen over 225% since the beginning of this year. NVIDIA is a software company based in California, United States. NVIDIA is most commonly known for making high-end graphics processing units. This software company is officially registered in Delaware, United States.

AJ Bell investment director Russ Mould said in an interview recently, "The AI hype train continues to push NVIDIA higher ahead of its results."
 

What does the NVIDIA do?

In simple terms, NVIDIA is a video game chip maker that can run heavily graphical video games. A couple of years ago, Artificial Intelligence researchers started using these chips to run the algorithms you have seen recently, causing breakthrough technological advancements.

Why is NVIDIA popular?

As mentioned above, NVIDIA makes high-performance graphics cards primarily for video games. During the Pandemic, Gaming exploded, and demand for NVIDIA graphic cards snowballed. At the same time, NVIDIA's high-performing chips were used by researchers in experimenting and running the algorithm of the most recent generative AI. NVIDIA Graphic cards are now used heavily in the mining of cryptocurrencies.

Why is Nvidia stock booming this year?

However, two of these (Cryptocurrency mining & Gaming) markets have already been here but have exploded to a new level in the past 2-3 years. Artificial Intelligence is comparatively a breakthrough but has much more space to grow soon. This market gap that NVIDIA Corp is filling and will continue to fill is why investors are heavily bullish on NVIDIA stock and AMD. 

Why did Nvidia stock go down in 2022?

In October 2022, NVIDIA stock crashed over 60 percent (USD 123.46) after the US government banned exports of high-performance AI chips to China and Russia. United States government issued this ban on exports sighting the threat that these high-performing chips could be used for military purposes, facial recognition, and weapons development. NVIDIA supposedly lost $400 Million worth of sales in the next quarter.

What will Nvidia be worth in 2025? 

Even if we ignore just the recent price surges, If NVIDIA shares keep growing the same as they have for the past ten years on average, NVIDIA shares price prediction stands around $912, doubling your investment.

NVIDIA stock price prediction 2030

According to analysts, NVIDIA stock could be worth over $1283 by 2030. A 250 percent increase from its current price. Although these are speculations, NVIDIA stock could surprise investors with a much more significant rise since it already holds a huge market.

$100 Investment in NVIDIA 10 years ago

If you had invested $100 in NVIDIA, your investment today would have been over $13500. In the last ten years, NVIDIA stock has turned $3.80 in stock value to its new all-time high of $480.88.
 

Where will NVIDIA be in 10 years?

Suppose we compare NVIDIA from 10 years ago, when the company only supplied graphics processors for personal computers and smartphones, to now, when NVIDIA has expanded into many high-potential markets such as cloud gaming, cloud computing, automotive and artificial intelligence, etc. NVIDIA stock's revenue will grow significantly over the next ten years, with a bright future ahead. 

China's role in NVidia stock growth- 

The Chinese economy is growing stronger by the day. When China overtakes the US economy, Taiwan could be at risk of its sovereignty since China has always claimed Taiwan to be a part of its motherland. If Taiwan, which produces 85 percent of the worldwide chip requirement, comes under the control of China, China could end up controlling the global chip supply. Thus the United States has encouraged companies to produce more chips and banned all special category chips export.

What is the historical rate of return of NVIDIA vs Bitcoin?

Since its Initial Listing in 1999, NVIDIA has given an all-time return of 107252 percent (More than 1072X return). If you compare it with the all-time return of Bitcoin, bitcoin beats NVIDIA with more than double with 238973 percent returns (Over 2389X return) in half the time taken by NVIDIA. However, it's worth noting that Bitcoin is a lot riskier investment than NVIDIA.

See Also:

Nvidia vs AMD Stocks, Which one is Best to Buy?

How to Invest in AI Stocks?