- Nvidia shares briefly surpassed Amazon's market cap on Monday.
- Shares of NVDA have risen for five straight weeks and are up 45% year-to-date.
- Shares of Beamr Imaging surged 700% after announcing joint research with Nvidia.
- Shares of Arm Holdings rose more than 20% on Monday.
Nvidia (NVDA) shares briefly became the fourth most valuable U.S. public company on Monday after briefly overtaking Jeff Bezos' crown jewel. Nvidia's market capitalization closed the day at $1.785 trillion, just short Amazon (AMZN) market capitalization of $1.79 trillion. However, Nvidia took the lead for a few minutes around 11:30 a.m. EST before post-lunch traders booked gains and Nvidia moved back to fifth place. The last time Nvidia was worth more than Amazon was in 2002, and both companies were worth just under $10 billion at the time.
Shares of NVDA traded up as much as 3.4% on Monday, but closed the first day of the week up a modest 0.16% at $722.48. NVDA shares then sold off four-tenths of a percent after hours to trade below $720. The post-market was overshadowed by the surprise earnings results of ZoomInfo Technologies ( ZI ), which rose 23% after hours.
The market was mixed Monday afternoon as the Dow Jones gained 0.33%, while the NASDAQ Composite lost 0.3% and the S&P 500 lost 0.09% ahead of Tuesday's consumer index. Price index (CPI) print for January.
Nvidia stock news
Nvidia shares have been at rock bottom lately. For the past five consecutive weeks, semiconductor stocks have hit new all-time highs, and four of the five weeks have seen gains in excess of 8%.
Nvidia shares are up 45% year-to-date, leading all other mega-cap tech stocks among the vaunted Magnificent Seven. When Nvidia reports quarterly results next Wednesday, February 21st, the market is more than excited to take a look under the hood of CEO Jensen Huang's megalith.
The eagerness pushing up NVDA's stock price comes from a mix of factors. In general, however, the market shrugged off previous concerns over a glut of AI-focused chips on the market, uncertainty over Nvidia's stock holdings and the Biden administration's technology sanctions against China.
Earlier this month, a Goldman analyst wrote that previous expectations of a decline in demand for server chips were unfounded, and Goldman raised its price target on NVDA shares from $620 to $800.
Bank of America Securities strategist Michael Hartnett said in a client note that Nvidia has increased its market cap by Tesla (TSLA)which is worth 600 billion dollars.
In others newsIsraeli video encoder Beamer Imaging (BMR) saw its shares soar more than 700% on Monday after announcing that it will present new research this week with Nvidia researchers at ACM Mile-High-Video 2024. Beamr Imaging is set to release its new video cloud service on February 20, which runs on Nvidia hardware.
Nvidia wasn't the only semiconductor company to hit new highs on Monday, either. Arm Mounts (ARM) follows its 48% run last Thursday, the product of its first earnings release as a newly public company, with a 23% gain here Monday.
Frequently Asked Questions About Semiconductor Stocks
Semiconductor is a term for various types of computer chips. Officially called semiconductor devices, these computer chips rely on semiconductor materials such as silicon and gallium arsenide to process the electrical current that creates the modern world of computing. They come in many shapes, sizes, enhancements and configurations, such as diodes, transistors and integrated circuits to more complex applications such as DRAM memory, simple processors and even GPUs.
First, they are pure chip designers like Nvidia, AMD, Broadcom and Qualcomm. These companies use sophisticated software to design and test chips. Second, there are equipment manufacturers who provide the machinery necessary to make computer chips. These include ASML and Lam Research. Then there are foundries that make chips. These include Taiwan Semiconductor and GlobalFoundries. In last place are integrated device manufacturers who design their own chips and also manufacture them themselves. These include Samsung and Intel.
It is an observation that the number of transistors in an integrated circuit doubles every two years. “The Law” is named after Gordon Moore, who founded Fairchild Semiconductor and later Intel. Doubling is possible due to the shrinking size of processing nodes or parts in a computer chip. By 1971, advanced commercial production had reached a width of 10 microns. In 1987, semiconductor technology advanced to a width of 800 nanometers. By 1999, this process had moved to 180 nanometers. By 2007, the size had dropped to 32 nanometers, and in 2022, it would go down to 3 nanometers, which is close to the size of human DNA.
In 2022, the global semiconductor industry had sales of just under $600 billion. Overall, the industry shipped 1.15 trillion semiconductor units in 2021. The leading countries involved in the semiconductor supply chain are Taiwan, the United States, China, the Netherlands, South Korea, Japan, and Israel.
Nvidia stock forecast
Nvidia shares hit a new all-time high of $746.11 on Monday. The fact that NVDA stock hit resistance here almost immediately isn't surprising.
The price action is directly in line with the ascending upper trend line that started in 2020 and was then retested in late 2021. After a long sell-off in 2022 and an extreme bounce in 2023, NVDA stock has returned to this trend line near $725.
Nvidia stock briefly broke above the upper trend line, so it seems likely that the bulls could turn the long-term trend line into a support structure. But the main obstacle seems to be the weekly Relative Strength Index (RSI). It looks extremely overbought at the moment, so some level of consolidation seems more likely.
NVDA Daily Stock Chart