Nvidia’s (NASDAQ: NVDA) dominance in artificial intelligence (AI) was on display again this week as the company regained a $5 trillion market cap and its stock price hit a new all-time high.
At the same time, the chipmaker currently accounts for nearly 5% of the MSCI All Country World Index (ACWI), outperforming domestic markets such as Japan, Germany, and France.
This month’s steady growth thus more than offset the losses suffered in March, when NVIDIA stock hit its lowest point of the year, ending the quarter at $165.
If you invested $1,000 in Nvidia on January 1st, here’s what you have today.
At the time of writing, NVIDIA stock was trading at a much higher price of $213.17, for a year-to-date (year-to-date) total return of 12.88%. This means that a $1,000 investment on January 1st would be worth approximately $1,128.80 today.
If you invested exactly one year ago, your $1,000 would be worth $1,954.40, considering the stock is up 95.44% on the yearly chart. Even more impressive, the same investment from 10 years ago would be worth $218,000 today.
It’s hard to name another large-cap stock that can match this kind of performance. This is especially true given that the majority of shareholder returns appear to come from underlying business growth rather than just multiple inflations. As a result, many analysts remain bullish.
Of course, this growth has largely been driven by AI, as companies race to invest heavily in the hardware needed to build next-generation computing infrastructure. NVIDIA’s trajectory will continue to be closely tied to this field.
Therefore, as long as the company continues to pour capital into its infrastructure, it stands to benefit from further revenue and profit growth. But it also means that momentum is increasingly dependent on sustained enthusiasm for AI.
Featured image via Shutterstock
