Nvidia Has Added the Entire Value of Tesla to Its Market Cap Since January 01, but the Stock’s Dotcom Bubble Analog Suggests Further Gains Lie Ahead

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NVIDIA shall conquer all, it seems, and match the mind-boggling valuations seen just before the Dotcom bubble burst – the only threat on the horizon: the Federal Reserve’s intransigence on cutting the benchmark interest rate.

As we noted in a dedicated post yesterday, NVIDIA briefly eclipsed the market capitalization of both Google’s parent, Alphabet, as well as Amazon’s.

The high-flying stock is up around 400 percent relative to the start of 2023. More astonishing still, since the beginning of 2024, NVIDIA has added around $650 billion in market capitalization, which eclipses the entire market-based value of Tesla!

As the AI-driven demand for NVIDIA’s chips shows no sign of slowing, Wall Street appears to be tripping over itself to broadcast uber-bullish projections. For instance, Goldman Sachs announced last week that it no longer saw NVIDIA’s data center revenue in a decline in the second half of this year. Rather, the Wall Street behemoth has now modeled “consistent growth through 1HCY25 driven by continued spending on Gen AI infrastructure by the large cloud service providers, a broadening customer profile, and multiple new product cycles (e.g. H200, B100).”

Today, Mizuho Securities raised its target for NVIDIA shares to $920, corresponding to a further upside potential of around 27 percent.

NVIDIA and the Dotcom Bubble Analog

This brings us to the crux of the matter. Matt Cerminaro deliberately lagged NVIDIA’s stock price by 25 years to see how perfectly it aligns with that of Cisco – a darling of the market in the Dotcom bubble era. As shown in the above post, the two stocks align almost perfectly. What’s more, NVIDIA’s price will have to triple in the next 433 days to match the apex of Cisco’s valuation during the internet bubble. This means that in little over a year, NVIDIA’s market cap will have to eclipse $5 trillion for this analog to hold!

We noted previously that with encyclopedia companies such as the Brittanica Group going public now, we might well be living in an echo of the Dotcom bubble. This bodes well for NVIDIA’s prospects, at least, until the market’s current insanity lasts.

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