After the starting bell rang today, NVIDIA stock breached the $300 psychological barrier and blew past $312 to achieve a new all-time high for the company. NASDAQ:NVDA is currently creating support at this critical level and putting on the hurt to the shorts. This is something that the company’s investors have been wishing for almost a year and a half and looks like Christmas has come early.
NVIDIA (NASDAQ: NVDA) reaches a new all-time high of $312.87 with a market cap of $191 Billion
Up until September 2018, Jensen was putting out record quarters on record quarters and NVIDIA’s stock seemed likely to breach the $300 level, taking it to new heights. Its GPUs had been powering the cryptocurrency boom for the past few years and GPGPU for AI was taking off as well. History, it transpired had different plans. A break in its record quarters preceded a collapse in the stock price. It was a bumpy ride for investors as the stock plummeted to $145 and recovered slowly as the company’s next-generation graphics cards based on the Turing architecture were mostly deadpanned.
2020, it seems, is going to be NVIDIA’s year, because the stock has been undergoing an insane recovery and has finally breached $300 and achieved a new all-time high of $312.87. This is mostly on the back of anticipation of the launch of its brand new Ampere GPUs as well as a speculated shift to 7nm which would allow it to drive down costs while increasing the performance profile of its graphics cards. The company has also seen a lot of windfall from Nintendo Switch sales (although these might be affected by the Coronavirus slowdown that Nintendo expects to face).
Another driver for this comeback is the fact that Turing is finally becoming affordable. The SUPER lineup has brought down the cost of gaming by offering more powerful GPUs for (relatively) cheaper prices and the non-RTX Turing series has proven to be a crowd favorite with affordable GPUs and great performance. AMD has also remained mostly uncompetitive in the high-end gaming segment and has only offered any competition in the mainstream segment.
The company’s Ampere GPUs will be able to drive down the cost of gaming even further and turn up the heat for AMD Radeon cards, and if the rumors about 7nm is true, kick start another buying frenzy as PC gamers enter an upgrade cycle to take advantage of the generational leap in performance (which is pretty large during node changes). The Total Available Market (TAM) for gamers also continues to increase as more and more users in the target demographic increase their purchasing power.
The company’s GPUs have also been tapped for various AI-related workloads as well as on-board driving computers and remain the only viable choice for employing a GPGPU on the go. Short of Tesla’s mysterious self-driving computer, nothing comes close. With Nintendo switch sales and SUPER Turing already fully priced in, investors should look out for news related to Ampere GPUs launch as well as the lineup and positioning associated with it. The company is also teaming with Intel to launch its SUPER mobility GPUs soon (as covered in our exclusive earlier).