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NVIDIA (NVDA) Stock Up 3.5% on Report of Investing in Arm
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NVIDIA Corporation (NVDA - Free Report) is reportedly in talks to invest in SoftBank Group Corp. (SFTBY - Free Report) controlled chipmaker — Arm. Per a recent Financial Times article, the semiconductor industry giant is negotiating with Arm as part of an initial group of anchor investors.
According to the report, Softbank is looking to launch an IPO for Arm, and Nvidia will join Intel Corporation (INTC - Free Report) , among other investors, as part of that IPO. Nvidia is rumored to have valued the company at $35-$40 billion, about half of what Softbank intends to value it at, i.e, $80 billion.
This is a significant development if one sees this in the light of what transpired in 2022. Following a two-year negotiation, starting in 2020, Nvidia tried and abandoned the effort to purchase Arm from Softbank, when its $66 billion offer fell through after regulators challenged the deal.
If Nvidia does emerge as one of the first big investors in ARM’s IPO, it would be a major shot in the arm for the latter. The link between the two companies is sustained with very important projects. The most important of these, perhaps, is Nvidia’s Grace Hopper superchip, which is intended for AI-related work. Arm needs Nvidia’s AI expertise for its growth ambitions.
The reportage also helped in pulling up the share price of the chipmaking behemoth by 3.5% on Wednesday. With this surge, Nvidia has almost tripled its value this year. It has been the success story of the year, with the AI boom contributing to its valuation surpassing $1 trillion in 2023.
Nvidia, which is a Zacks Rank #1 (Strong Buy) company and part of the Zacks Semiconductor – General industry, has an expected earnings growth rate for the current year at 129.9%. The Zacks Consensus Estimate for its current-year earnings has improved 71.1% over the past 60 days.
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
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NVIDIA (NVDA) Stock Up 3.5% on Report of Investing in Arm
NVIDIA Corporation (NVDA - Free Report) is reportedly in talks to invest in SoftBank Group Corp. (SFTBY - Free Report) controlled chipmaker — Arm. Per a recent Financial Times article, the semiconductor industry giant is negotiating with Arm as part of an initial group of anchor investors.
According to the report, Softbank is looking to launch an IPO for Arm, and Nvidia will join Intel Corporation (INTC - Free Report) , among other investors, as part of that IPO. Nvidia is rumored to have valued the company at $35-$40 billion, about half of what Softbank intends to value it at, i.e, $80 billion.
This is a significant development if one sees this in the light of what transpired in 2022. Following a two-year negotiation, starting in 2020, Nvidia tried and abandoned the effort to purchase Arm from Softbank, when its $66 billion offer fell through after regulators challenged the deal.
If Nvidia does emerge as one of the first big investors in ARM’s IPO, it would be a major shot in the arm for the latter. The link between the two companies is sustained with very important projects. The most important of these, perhaps, is Nvidia’s Grace Hopper superchip, which is intended for AI-related work. Arm needs Nvidia’s AI expertise for its growth ambitions.
The reportage also helped in pulling up the share price of the chipmaking behemoth by 3.5% on Wednesday. With this surge, Nvidia has almost tripled its value this year. It has been the success story of the year, with the AI boom contributing to its valuation surpassing $1 trillion in 2023.
Nvidia, which is a Zacks Rank #1 (Strong Buy) company and part of the Zacks Semiconductor – General industry, has an expected earnings growth rate for the current year at 129.9%. The Zacks Consensus Estimate for its current-year earnings has improved 71.1% over the past 60 days.
Softbank and Intel shares also climbed 4.6% and 2%, respectively, on the news. Intel currently carries a Zacks Rank #2 (Buy), and Softbank has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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