For computer owners, gamers, miners, designers, and technology fans, Nvidia means quality. Jen-Hsun Huang, Curtis Priem, and Chris Malachowsky founded NVIDIA in 1993. Their bet on graphics processing units (GPUs) paid off. Since its foundation 28 years ago, the tech giant has found a way into practically all spheres of life. Nvidia technologies are used in medicine, smartphones, transport, 2/3 of computers in the world run on Nvidia technologies. There is no doubt that the value of Nvidia shares is high. Since the company's shares were listed on the exchange, their price has surged by 6,158%. Analysts continue to see growth potential in the company.

NVIDIA holds a strong position in the market. The corporation’s market capitalization totals $487 billion. Today, the company is developing in 11 fields. Its main focus is on gaming, professional visualization, data centers, and artificial intelligence.

Nvidia products

  • GeForce - graphics processing units targeted at gamers
  • Quadro - graphics cards intended for use in design
  • Tegra - chips for mobile and gaming devices
  • Tesla - products targeted at search and data processing
  • nForce - chips for Intel and AMD
  • Nvidia GRID - Cloud computing
  • Nvidia Shield - gaming hardware
  • Nvidia Drive- automotive solutions

Main subsidiaries

  • 3dfx Interactive, a GPU developer
  • Icera Inc, a producer of chips for mobile technology, computers, and smartphones
  • Nvidia Advanced Rendering Center provides 3D modeling solutions

NVIDIA shares

Within the last 5 years, NVIDIA shares soared by 4800.13%. The company is gaining in popularity owing to its top products, as well as the global trend towards digitalization and mining. The coronavirus pandemic has also contributed to a rise in the company’s shares. Since March 2020, NVIDIA shares have added over 300%. The company is the constituent of the S&P 500, Nasdaq 100, Dow Jones Large-Cap, Dow Jones Value, etc.

Main shareholders

  • Jen-Hsun Huang, 1.3 million shares (0.21%)
  • Colette Kress, 157,773 shares (0.03%)
  • Mark Stevens, 157,186 shares (0.03%)
  • Vanguard Group, 48.0 million shares (7.7%)
  • BlackRock , 44.8 million shares (7.2%)
  • FMR, 43.7 million shares (7.1%)

Some 66.7% of Nvidia shares are owned by institutional shareholders as of Q4 2020.

Stock split and prospects

The corporation has divided its stock several times. Between 2000 and 2007, Nvidia split its shares four times. On July 20, 2021, it executed a 4-to-1 stock split for the first time in 14 years. Many experts believe that a massive buying opportunity comes after a split and a slight drop in the share price.

Investors associate NVIDIA with profit and records. The first quarter of 2021 was no exception. The company's net income rose by 109% to $1.9 billion. Quarterly earnings grew by 84%. The corporation’s main areas of activity brought the largest profits. The gaming sector showed a record increase in revenue by 106%. Nvidia booked $155 million in revenue from crypto mining cards in the first quarter. The company pays a dividend of 0.08% per share to shareholders.

Nvidia has recently announced the purchase of Arm Holdings, a semiconductor company, from SoftBank. The merger of these two tech giants promises NVIDIA a great future as it may turn into a tech monopolist. The deal has already caused serious concerns of competitors and regulatory authorities, but the company is keeping its path. The $40 billion deal is expected to close as early as 2022. This makes Nvidia shares an attractive investment instrument.

Buying NVIDIA shares

The NASDAQ exchange remains the main trading floor to buy NVIDIA shares. In order to purchase this asset, an investor needs to find a broker with access to this exchange. In addition, NVDA shares are traded on European exchanges.

Drivers of NVIDIA share price

  • Industrial risks. NVIDIA is a leader in the semiconductor industry. The company takes a dominant position by market capitalization and debt-to-equity ratio but competition in the field of processor technology remains fierce. The industry is developing quite actively, new data centers appear, and technology companies are battling to win consumers.
  • Cryptocurrency market. NVIDIA products are popular among miners from all over the world and bring the company a good profit. However, there is also the other side of the coin. Fluctuations in the cryptocurrency market may affect the value of NVIDIA shares. Indeed, the corporation is trying to reduce its risks by creating products for miners and limiting the hash rate.
  • Technological risks. The global shortage of semiconductor chips remains relevant for NVIDIA and continues to provoke a shortage of products. The situation is relevant for the whole industry and not only NVIDIA.

Summary

NVIDIA has great growth potential, progressive technological products, and forward-looking management. Over the past 5 years, the company’s shares have increased sharply. Nvidia stock is expected to rise in the future, but there are risks investors should pay attention to if they choose to invest in the asset. You can always find fresh analytics about promising assets on the InstaForex website.