May 30 (Portal) – Nvidia Corp (NVDA.O) is on the verge of surpassing the $1 trillion market cap, becoming the first US chipmaker to join the trillion dollar club.
The gaming and AI chip company, whose shares rose 3.8% before open Tuesday, was valued at $998 billion.
Meta Platforms Inc (META.O), valued at around $670 billion at the last close, reached the $1 trillion market cap milestone in 2021, while Apple Inc (AAPL.O), Alphabet Inc (GOOGL .O), Microsoft Corp (Other US companies belonging to the club are MSFT.O) and Amazon.com Inc (AMZN.O).
AI took center stage after Nvidia stunned investors last week with a revenue forecast that beat analysts’ expectations by more than 50%.
Wall Street analysts called Nvidia’s forecast “unfathomable” and “cosmological” and raised their price targets in droves. The top price target put the company’s value at around $1.6 trillion, putting it on par with Google’s parent company Alphabet.
“With valuation well above long-term average, there will be significant pressure to deliver high growth on a consistent basis…there could be volatility in the stock price going forward,” said Susannah Streeter, Head of Money and Markets at Hargreaves Lansdown, said.
Shares of Nvidia surged about 25% last week, leading to a rally in AI-related stocks and buoying other chipmakers, which helped push the Philadelphia SE Semiconductor Index (.SOX) to its highest level in over on Friday closed a year.
The rapid success of OpenAI-owned ChatGPT has prompted tech giants like Alphabet and Microsoft to make the most of generative AI, which can engage in human-like conversations and invent everything from jokes to poetry.
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Reporting by Medha Singh, Akash Sriram and Samrhitha Arunasalam in Bengaluru; Edited by Shounak Dasgupta
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