February was nothing short of amazing for NVIDIA (NASDAQ: NVDA) stock. During the month, $431 billion was added to its market capitalization.
On February 21, only $272 billion increased in value. For context, that's more than FTSE 100 unconditional PA, Unileverand GSK set!
Its stock price skyrocketed 25.6% throughout the month. Year to date, the stock is up 64.2%. In the last 12 months it has risen 239.3%. If you had bought Nvidia stock five years ago, you would have made a monumental gain of 1,923.4%.
As far as yields are concerned, the situation does not improve much. And that has me thinking.
I own some Nvidia stock. As I write, I made a profit of 86.8% on my investment. But with the market clearly optimistic about the company's future, should I rush to buy more?
A stellar performance
The main reason for its increase was the publication of its results for the last quarter and the full year, which exceeded analysts' expectations.
All in all, it posted record revenue for the year, reaching $60.9 billion, up 126% from 2022. Net revenue was also up an incredible 581%.
Similarly, in the fourth quarter it posted record quarterly revenue of $22.1 billion. Its data center sales increased 409% year over year.
Nvidia can't seem to slow down.
Market leader
But where do we go from here? The stock is one of the hottest stocks on the market right now. Can he sustain this incredible form?
It can certainly be argued that this will be the case. This is especially after CEO and founder Jensen Huang said the ai (artificial intelligence) industry is now at its “best moment.”inflection point”.
ai has boomed in recent years. And as a leader, I think Nvidia could have more profits. It is best known for manufacturing graphics processing units (GPUs). The company is expected to have between 90% and 95% market share. Companies included Goal, teslaand microsoft These are just some of the customers rushing to buy Nvidia GPUs.
Risks remain
But not everything is a bed of roses, although it may seem that way.
The stock has skyrocketed. But that always carries a risk. Apollo Global Management recently said that the 10 largest companies in the world S&P 500which includes Nvidia, are “More overvalued than the top 10 companies during the tech bubble of the mid-1990s.”. With that, there is a risk that we see high volatility.
I must also remember that this is a rapidly evolving industry. Nvidia has burst onto the scene. What does it mean that one of your competitors doesn't do the same and steals the show?
Long term vision
However, I am excited about the direction Nvidia could take in the next five to ten years. And even more, by the way.
I think there is a chance that we will see big fluctuations in its share price in the coming times. The market now has high expectations for the business, so any sign of a slowdown could spook some investors.
But Nvidia is the market leader. In the years and decades to come, I hope the business continues to thrive. I really want to acquire more shares.
