Actions of Nvidia (NASDAQ:NVDA) jumped higher Tuesday, jumping as much as 6.3%. As of 1:59 p.m. ET, the stock was still up 5.8%, bringing it back above that psychologically important level. Market capitalization of $3 trillion.
The catalyst that sent the chipmaker and artificial intelligence (AI) The specialist learned above that the company is entering an important new market, which could boost its future sales.
A vast new market
Nvidia’s graphics processing units (GPUs) have become the benchmark and a key part of the rise of generative AI. These processors provide the computing power needed to accelerate the AI training and inference process, which primarily occurs in data centers.
The company has signed a deal to bring its AI expertise to telecommunications company Ooredoo of the Middle Eastern country of Qatar. The deal will provide its customers in Qatar, Algeria, Tunisia, Oman, Kuwait and the Maldives with “direct access” to Nvidia’s AI technology, according to a Reuters report.
The US government has limited the technology Nvidia can export to Middle Eastern countries in order to prevent China from accessing its most sophisticated technology. The report suggests that Nvidia would comply with government mandates while playing a significant role in supplying AI chips to the region.
The expansion of AI continues
This news follows Nvidia’s latest blockbuster financial report, which continues its triple-digit revenue and profit growth. This, in turn, has fueled its stock price rise and recent 10-for-1 stock split.
Some investors have expressed concern that the next stage of Nvidia’s growth is slowing and wonder how much further AI has left. Most experts agree, however, that AI adoption is still in its infancy. Generative AI will become a $1.3 trillion market by 2032, according to estimates provided by Times Of Update Intelligence.
Furthermore, at approximately 35 times forward earnings, Nvidia stock remains reasonably priced, particularly in light of the continued opportunity presented by AI.
Should you invest $1,000 in Nvidia right now?
Before buying Nvidia stock, consider this:
THE Motley Fool Stock Advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now…and Nvidia wasn’t one of them. The 10 selected stocks could produce monster returns in the years to come.
Consider when Nvidia made this list on April 15, 2005…if you had invested $1,000 at the time of our recommendation, you would have $723,729!*
Equity Advisor provides investors with an easy-to-follow plan for success, including portfolio building advice, regular analyst updates, and two new stock picks each month. THE Equity Advisor the service has more than quadrupled the return of the S&P 500 since 2002*.
*Stock Advisor returns June 24, 2024
Danny Vena has positions at Nvidia. The Motley Fool Ranks and Recommends Nvidia. The Motley Fool has a disclosure policy.
Discover more from The Times Of Update
Subscribe to get the latest posts sent to your email.
