March 3, 2024

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Nvidia Is Now Worth More Than Berkshire Hathaway, Tesla, and AMD Combined. But Will It Last?

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Nvidia (NASDAQ: NVDA) was the best-performing stock in the entire S&P 500 last year. As of Feb. 7, it is also the best-performing stock so far this year.

At first glance, this accomplishment sounds like Nvidia simply sustained its momentum when the calendar year flipped, which it did. But keep in mind that Nvidia, like the rest of the S&P 500, had a 0% year-to-date performance on the morning of Jan. 1. After surging by 238.9% in 2023, Nvidia is already up an additional 41.6% in 2024. Put another way, it is up 379.7% since Dec. 31, 2022.

I have never seen a company the size of Nvidia follow up a banner year with such a swift and sudden spike. In fact, Nvidia is now worth more than Warren Buffett-led Berkshire Hathaway, electric vehicle leader Tesla (NASDAQ: TSLA), and its fellow semiconductor giant Advanced Micro Devices — combined.

But for those considering adding Nvidia to their portfolios now, the real questions are whether the growth stock can continue its rally and whether it’s worth buying at today’s levels.

A person clasping their hands while sitting at a table with a laptop and looking to the side with a wireless earbud in their ear.

Image source: Getty Images.

Nvidia’s surge has been nothing short of historic

The only price move that I can think of that comes anything close to what we are seeing with Nvidia is what Tesla did in 2020, when it gained 743.4% in a single calendar year, boosting its market cap from $75.5 billion to $677.4 billion.

However, Nvidia has topped even Tesla in terms of value creation. At the end of 2022, Nvidia had a market cap of $359.5 billion. As of Feb. 7, Nvidia’s market cap is $1.73 trillion. So, in a little over 13 months, Nvidia added $1.37 trillion to its market cap, roughly double what Tesla did in a similar time.

It’s not an exaggeration to say that Nvidia’s combination of percentage gain and market cap gain is changing the market. Nvidia now accounts for 4.1% of the value of the SPDR S&P 500 ETF Trust, an ETF that mirrors the performance of the S&P 500. It’s also 5% of the Invesco QQQ ETF, which tracks the performance of the Nasdaq 100. Every time…

2024-02-12 06:05:00

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