On a record-breaking Tuesday, Nvidia, a leading player in the AI industry, saw its shares surge by approximately 6%, bringing its market value tantalizingly close to that of tech giant Apple. This development marks a significant shift in the hierarchy of Wall Street’s most valued entities.
Nvidia’s Market Performance
Nvidia’s shares were last traded at $1,128, pushing the company’s market capitalization to an impressive $2.8 trillion. In comparison, Apple, the second-most valuable company on Wall Street after Microsoft, boasts a market value of $2.9 trillion.
During the trading session, Nvidia’s stock surged by as much as 8% to reach an intra-day record high of $1,149.39. Meanwhile, Apple’s stock experienced a slight dip of 0.2% in afternoon trading.
Nvidia’s Growth Trajectory
Nvidia’s shares have seen a nearly 13% surge since it projected second-quarter revenue above Wall Street expectations last week. The announcement of a stock split further excited investors, who continue to place their bets on this AI frontrunner.
“The market has been struggling to keep up with the company’s ever-improving growth trajectory. At a mid-thirties forward earnings multiple, this still doesn’t feel like bubble territory,” commented Derren Nathan, head of equity analysis at Hargreaves Lansdown.
Nvidia’s Position in the AI Industry
Nvidia, a major beneficiary of the AI boom, reported a five-fold increase in revenue at its data center segment last week. Tech companies such as Alphabet, Microsoft, and Amazon.com are vying for a limited supply of Nvidia’s high-end chips as they strive to dominate AI computing.
“Business is doing incredibly well, there are so many opportunities to keep growing, and the AI theme still has legs. When the song is that catchy, investors want to keep humming it all day long,” said Dan Coatsworth, an investment analyst at AJ Bell.
Apple’s Market Performance
Long considered a must-own stock on Wall Street, Apple has underperformed other Big Tech companies in recent months. The company’s shares have fallen around 2% this year as it grapples with weak iPhone demand and stiff competition in China.
Microsoft surpassed Apple as the world’s most valuable company earlier this year. This was largely due to the gains made by early investments in artificial intelligence across its cloud services.
Conclusion
The race between Nvidia and Apple highlights the increasing importance of AI in shaping the future of technology. As Nvidia continues to make strides in the AI industry, it will be interesting to see how this reshapes the landscape of Wall Street’s biggest players.
