It’s easy to get caught up in the excitement of how the Nvidia share price has almost stratospherically risen nearly 2,000% over the last five years. But unlike Gamestop, Nvidia is not a meme stock, even though it has at times experienced volatility similar to meme stocks, especially during periods of heightened interest in AI and tech.
Nvidia is actually a pioneering company with solid fundamentals, strong leadership, a market leader with significant institutional support.
Strong Fundamentals
Nvidia is a leading semiconductor company known for its high-performance GPUs, widely used in gaming, AI, data centers, and autonomous vehicles. Its success is driven by real demand and innovation.
| YoY Change | Jan-24 | Jan-23 | Jan-22 | |
| Total Revenue | 125.85% | 60,922 | 26,974 | 26,914 |
| Operating Revenue | 125.85% | 60,922 | 26,974 | 26,914 |
| Cost Of Revenue | 43.06% | 16,621 | 11,618 | 9,439 |
| Gross Profit | 188.49% | 44,301 | 15,356 | 17,475 |
Market Leadership
Nvidia holds a dominant position in graphics and AI technology, making it a core stock in the tech industry rather than a speculative play like most meme stocks.
Nvidia is the top designer of discrete graphics processing units that enhance the experience on computing platforms. The firm’s chips are used in a variety of end markets, including high-end PCs for gaming, data centers, and automotive infotainment systems.
In recent years, the firm has broadened its focus from traditional PC graphics applications such as gaming to more complex and favorable opportunities, including artificial intelligence and autonomous driving, which leverage the high-performance capabilities of the firm’s products.
Nvidia has institutional shareholders.
Unlike meme stocks (e.g., GameStop or AMC), which rely heavily on retail hype, Nvidia is a favourite among institutional investors and is frequently included in major stock indices.
Valuation Driven by AI Boom
Nvidia’s valuation surged significantly in 2023-2024 due to its pivotal role in AI technology, including supplying GPUs for companies like OpenAI and Google.
Meme Stock-Like Behavior
Nvidia’s stock has occasionally seen rapid spikes and corrections, leading to comparisons with meme stocks. For example, its valuation hit historic highs as retail investors jumped on the AI trend.
But, there are those that believe it still has a future, we spoke a top UK fund manager about where he thought the Nvidia share price will be in fives years time.
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