Nvidia Corporation, a leading chipmaker, has achieved a market valuation that is equivalent to the entire Chinese stock market, marking a historic milestone. According to a research note from Bank of America’s chief investment strategist, Michael Harnett, Nvidia’s market cap has surged by $600 billion in the past two months, reaching an impressive $1.7 trillion. This valuation now matches the combined market cap of all Chinese-listed companies on the Hong Kong Stock Exchange.
Nvidia’s market cap has experienced a remarkable fourfold increase since the beginning of 2023. Its stock rose by 239% in 2023 and an additional 41% in 2024. Meanwhile, China’s economic struggles have led to a significant drop in stock prices, with the Hang Seng index, a key indicator for Chinese stocks listed in Hong Kong, falling by 26% over the past year and 8% year-to-date.
Despite Nvidia’s impressive growth, some experts have expressed concerns about its valuation. Aswath Damodaran, often referred to as the “Dean of Valuation,” has previously stated that Nvidia’s stock is “priced to the point of insanity.” However, other analysts have a more optimistic view of Nvidia’s future. Joseph Moore, an analyst at Morgan Stanley, reiterated an Overweight rating on Nvidia and increased his price target to $750, citing the company’s strong near-term results and unique valuation.
Nvidia’s recent partnership with Cisco Systems to expand AI technology in the corporate sector has further solidified its position as the most valuable chipmaker globally. This collaboration has bolstered investor confidence and contributed to Nvidia’s impressive market valuation.
Analysts are optimistic about Nvidia’s future growth potential, with Vivek Arya of Bank of America predicting a significant upside in the company’s quarterly earnings. This growth is expected to be driven by AI innovations and the upcoming launch of the B100 accelerator.
While Nvidia’s valuation has raised concerns among some experts, its strong performance and strategic partnerships have positioned the company as a key player in the global chipmaking industry. As the Chinese stock market faces challenges, Nvidia’s success serves as a testament to its resilience and potential for continued growth in the future.
