Nvidia has been a lucrative pick-and-shovel investment opportunity in the AI boom.
Nvidia (NVDA +1.02%) has deservedly gotten much attention in recent years thanks to its dominant position in the market for data center graphics processing units (GPUs). The business sells the high-end parallel processing chips that tech companies need to power artificial intelligence (AI) models. It’s a legitimate pick-and-shovel investment play.
The stock has been a big winner, and not just since the AI trend took off. If you’d invested $100 in Nvidia 10 years ago and held on through the ups and downs that followed, here’s how much your investment would be worth today.
Image source: Nvidia.
Nvidia shares have gone parabolic
In the past decade, Nvidia shares have produced a monster total return of 22,980% (as of Dec. 19), which would have turned a $100 investment into a holding worth more than $23,000. The company does pay a small dividend, currently just $0.01 per share quarterly, that has had a tiny effect on investor gains.
Nvidia has crushed the S&P 500. The market’s large-cap barometer had a 10-year total return of 305% — not even remotely close to Nvidia’s returns.
Today’s Change
(1.02%) $1.92
Current Price
$190.53
Key Data Points
Market Cap
$4.6T
Day’s Range
$188.00 – $192.69
52wk Range
$86.62 – $212.19
Volume
140M
Avg Vol
189M
Gross Margin
70.05%
Dividend Yield
0.02%
The chipmaker’s shares have been lifted by its robust fundamentals. Revenue and net income skyrocketed by 4,285% and 12,867%, respectively, between its fiscal Q3 2016 and its fiscal Q3 2026 (which ended Oct. 26). Nvidia is now the world’s most valuable company, sporting a market cap of $4.4 trillion.
Some investors fear that we’re in an AI bubble. Should spending on AI infrastructure slow down, it could have a negative effect on Nvidia’s impressive growth trajectory.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.
