To The Moon

🌟🌟🌟When it comes to which of the Magnificent 7 stocks is the best performer, Nvidia $NVIDIA Corp(NVDA)$  wins hands down.  Nvidia is sizzling hot with its share price skyrocketing a massive 193% year todate and in 2023, Nvidia has jumped 249%!

Nvidia recently reached its all time high of USD 144.42.  Can it go up further or is it too overpriced? 

Nvidia is the market leader in selling AI chips with over 80% market share.  This comes not only from its strong chip offering but also the wide moat Nvidia has been able to carve out due to its CUDA software.  Long before the AI frenzy, Nvidia has the foresight to create its CUDA platform to help developers program its GPUs using software that it gave away for free.  As a result, CUDA became the standard program upon which developers in the industry use to program these chips.  This has created an ecosystem that made it difficult for its competitors to break into this market and take a chunk off Nvidia's dominant position. 

Nvidia is not content to rest on its laurels and has recently sped up the development of its chips from a 2 year cycle to a one year cycle. This would help Nvidia retain its technological lead as well as give Nvidia its pricing power.   Nvidia has only just started to ship the  chips based on the Blackwell architecture yet it is getting ready  to introduce new chips based on its Rubin architecture in 2026.  This will help Nvidia to keep its dominant market share. 

Nvidia is still attractively valued despite its huge share price jump.  It trades at a forward price to earnings ratio or PE ratio at about 35 based on 2025 analysts estimates.  Nvidia has a price /earnings to growth or PEG ratio of just 0.9.  A PEG under 1 is generally viewed as undervalued and growth stocks often have PEGs well above 1.

Wall Street Analysts are bullish on Nvidia with a Buy rating, Average  Target price of USD 153.86, an upside potential of 8.7%.  This is according to 81 analysts surveyed by Tipranks.

In Q2 Fiscal 2025, Nvidia reported revenue of USD 30.0 billion, up 15% from the previous quarter and up 122% from a year ago.   For the quarter, GAAP earnings per diluted share was 67 cents, up 12% from previous quarter and up 168% from a year ago.  Non GAAP earnings per diluted share was 68 cents, up 11% from previous quarter and up 152% from a year ago. 

According to Jensen Huang CEO and Founder of Nvidia, Nvidia achieved record revenues as global data centers are in full throttle to modernise the entire computing stack with accelerated computing and Generative AI.  He also said that Hopper demand remains strong and the anticipation for Blackwell is incredible. 

Nvidia has also rewarded its shareholders in the form of shares repurchased and cash dividends.  As of end of second quarter, Nvidia had USD 7.5 billion remaining under its share repurchase authorisation.  On August 26 2024, Nvidia's Board of Directors has approved an additional USD 50 billion in share repurchase authorisation, without expiration.  Nvidia paid its quarterly cash dividend of 1 cent per share on October 3 2024 to its shareholders. 

Nvidia is expected to report its earnings on November 20.  

Nvidia is continuing to expand overseas.  In the latest development recently, Nvidia will supply AI processors to Indian companies such as Reliance Industries, Yotta Data Services and Tata Communications.  According to Jensen Huang, in the future India is going to be the country that will export AI as it has the fundamental ingredients - AI, Data and AI infrastructure and a large population of users. 

Nvidia has also signed an agreement with Malaysian conglomerate YTL's power unit to develop a USD 4.3 billion AI Cloud and Supercomputer infrastructure in Malaysia. 

In Singapore, Nvidia has partnered with Singtel $Singtel(Z74.SI)$  to bring Nvidia AI platform to businesses in Singapore and beyond.  Singtel is building energy efficient data centers across South East Asia, accelerated with Nvidia Hopper Architecture GPUs and using Nvidia AI reference architectures proven to deliver optimal performance. 

What an amazing company Nvidia is!  I am so happy that I have invested in Nvidia and held it till now.  It gave me a scare in September when it fell by 9.5% or USD 278.9 billion in market value.  This was due to news that the US Justice Department had decided to investigate Nvidia as it suspected that Nvidia maybe making it more difficult for clients to switch suppliers, while also imposing penalties on those that purchase other chips alongside Nvidia's products.  Fortunately Nvidia's shares have since recovered. 

It is normal for shares to move up and down like a roller coaster and Nvidia is no exception.  But when I look at its long term growth potential, nothing has changed and Nvidia is still fundamentally strong.  That is why I intend to hold on to my Nvidia shares long term as it is my AI Juggernaut. 

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