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Nvidia Off to a Great Start in 2024: Is More Rally in Store for ETFs?
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Nvidia (NVDA - Free Report) , the trillion-dollar chipmaker, has witnessed a remarkable 10% increase in its shares within the first nine trading days of 2024. This follows a significant 240% rise in its stock price during 2023, driven by advancements in AI technology, per a Business Insider article.
The company's market capitalization has escalated by $128 billion, reaching nearly $1.4 trillion, making it the fifth most valuable company in the U.S., behind leading giants like Microsoft, Apple, Google's Alphabet, and Amazon.
Outshining Competitors and Indices
Nvidia has outperformed not only its Big Tech rivals but also the benchmark S&P 500 in the early days of 2024. The AI investment trend is a key factor, with analysts predicting continued strong performance for the company.
This year marks Nvidia's best start in terms of market capitalization gains. It's outpacing the other "Magnificent Seven" mega-cap stocks, while companies like Microsoft and Meta Platforms show modest gains. Conversely, Apple and Tesla have experienced declines.
Market Stagnation Elsewhere
While Nvidia thrives, the S&P 500 and Nasdaq 100 indices have remained stagnant, following their significant gains in the previous year.
AI's Role in Nvidia's Success
Nvidia's surge is closely tied to the AI investment craze, with its dominance in graphics processing units significantly boosting earnings and helping it achieve a 12-figure valuation.
New Developments and Market Expansion
At the recent CES trade show, Nvidia unveiled three new desktop graphics chips, aimed at AI personal computers. This move, signaling potential new revenue streams, led to an 11% rise in shares over three days. Kathleen Brooks from XTB highlighted Nvidia's expansion into AI PC space as a key growth driver.
Wall Street's Positive Outlook
Based on short-term price targets offered by 35 analysts, the average price target for Nvidia comes to $646.54. The forecasts range from a low of $410.00 to a high of $1,100.00. The average price target represents an increase of 18.18% from the last closing price of $547.10 (as of Jan 15, 2024).
The Zacks Rank #2 (Buy) Nvidia currently has an average brokerage recommendation (ABR) of 1.23 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.) made by 37 brokerage firms. The current ABR compares to an ABR of 1.18 a month ago based on 37 recommendations.
Of the 37 recommendations deriving the current ABR, 31 are Strong Buy and three are Buy. Strong Buy and Buy respectively account for 83.78% and 8.11% of all recommendations. A month ago, Strong Buy made up 86.49%, while Buy represented 8.11%.
Image: Bigstock
Nvidia Off to a Great Start in 2024: Is More Rally in Store for ETFs?
Nvidia (NVDA - Free Report) , the trillion-dollar chipmaker, has witnessed a remarkable 10% increase in its shares within the first nine trading days of 2024. This follows a significant 240% rise in its stock price during 2023, driven by advancements in AI technology, per a Business Insider article.
The company's market capitalization has escalated by $128 billion, reaching nearly $1.4 trillion, making it the fifth most valuable company in the U.S., behind leading giants like Microsoft, Apple, Google's Alphabet, and Amazon.
Outshining Competitors and Indices
Nvidia has outperformed not only its Big Tech rivals but also the benchmark S&P 500 in the early days of 2024. The AI investment trend is a key factor, with analysts predicting continued strong performance for the company.
This year marks Nvidia's best start in terms of market capitalization gains. It's outpacing the other "Magnificent Seven" mega-cap stocks, while companies like Microsoft and Meta Platforms show modest gains. Conversely, Apple and Tesla have experienced declines.
Market Stagnation Elsewhere
While Nvidia thrives, the S&P 500 and Nasdaq 100 indices have remained stagnant, following their significant gains in the previous year.
AI's Role in Nvidia's Success
Nvidia's surge is closely tied to the AI investment craze, with its dominance in graphics processing units significantly boosting earnings and helping it achieve a 12-figure valuation.
New Developments and Market Expansion
At the recent CES trade show, Nvidia unveiled three new desktop graphics chips, aimed at AI personal computers. This move, signaling potential new revenue streams, led to an 11% rise in shares over three days. Kathleen Brooks from XTB highlighted Nvidia's expansion into AI PC space as a key growth driver.
Wall Street's Positive Outlook
Based on short-term price targets offered by 35 analysts, the average price target for Nvidia comes to $646.54. The forecasts range from a low of $410.00 to a high of $1,100.00. The average price target represents an increase of 18.18% from the last closing price of $547.10 (as of Jan 15, 2024).
The Zacks Rank #2 (Buy) Nvidia currently has an average brokerage recommendation (ABR) of 1.23 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.) made by 37 brokerage firms. The current ABR compares to an ABR of 1.18 a month ago based on 37 recommendations.
Of the 37 recommendations deriving the current ABR, 31 are Strong Buy and three are Buy. Strong Buy and Buy respectively account for 83.78% and 8.11% of all recommendations. A month ago, Strong Buy made up 86.49%, while Buy represented 8.11%.
ETFs in Focus
Zacks Rank #1 (Strong Buy) VanEck Semiconductor ETF (SMH - Free Report) – NVIDIA has 19.84% Focus
AXS Esoterica NextG Economy ETF (WUGI - Free Report) – NVIDIA has 18.25% Exposure
Simplify Volt RoboCar Disruption and Tech ETF (VCAR - Free Report) – NVIDIA has 14.05% Exposure
Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report) – NVIDIA has 13.29% Exposure
Zacks Rank #2 Pacer Data and Digital Revolution ETF (TRFK - Free Report) – NVIDIA has 13.09% Exposure