Nvidia share price adds $190 billion overnight. Where to from here?

26 May 2023

Motley Fool Australia

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Key pointsLast night (our time), the NVIDIA stock price rocketed an astonishing 24.37%, leaving it with a market capitalisation of almost US$940 billion.This makes NVIDIA one of the largest companies in the world, and only a few points off of the exclusive US$1 trillion clubInvestors have been fighting over NVIDIA shares ever since the company's stunning earnings report was released earlier this week

It’s hard to overstate what a run the NVIDIA Corporation (NASDAQ: NVDA) share price has been on over the past few months and years.

Last night alone (our time), the NVIDIA stock price rose by a whopping 24.37%, leaving the US semiconductor stock at US$379.80 per share, up from the US$305.38 the company closed at on Wednesday night.

NVIDIA also hit a new all-time record high in the process, clocking a peak of US$394.80 a share during intra-day trading.

This gain added an incredible US$184 billion to NVIDIA’s market capitalisation in just one day. The company now has a market cap of US$939.3 billion, placing it just shy of the exclusive US$1 trillion club, which is currently only occupied by five companies. Those would be Apple, Amazon.com, Microsoft, Alphabet and Saudi Aramco.

NVIDIA started the year at just US$143.15, so this company is now up a hefty 165.32% in 2023 so far. It’s also trading almost 240% higher since October last year:

The spike in valuation overnight comes after NVIDIA posted what might go down as one of the most shocking quarterly earnings reports in history the previous day.

As we covered yesterday, NVIDIA reported a 26% rise in year-on-year net income to US$2.043 billion from quarterly revenue of US$7.192 billion. But the real headline grabber was NVIDIA’s forward guidance. The company told investors it expected US$11 billion in revenue for the upcoming second quarter of FY2024. Analysts were anticipating a figure of US$7.2 billion.

So after these amazing gains, where might the NVIDIA share price be headed to next?

Is it possible the NVIDIA share price can keep rising?

According to Forbes, one analyst thinks this is just the beginning for NVIDIA stock.

Rosenblatt analyst Hans Mosesmann reportedly reckons NVIDIA is only just getting started. Mosesmann has given the company an enormous share price target of US$600 following the earnings report.

That would imply another 38% upside for the NVIDIA share price from the US$379.80 it closed at last night. That is a big increase for Mosesmann over the previous share price target of US$320.

If NVIDIA stock hits US$600, it would make the company larger than e-commerce giant Amazon.

Craig-Callum analyst Richard Shannon also gave the company a boosted share price target, but a little lower at US$500. He called the potential upside for NVIDIA from here “truly amazing”.

Here’s a quote from another analyst in Cowen’s Matthew Ramsay:

Overall, NVIDIA’s results and guide leave us with our jaws dropped as the technological leadership in AI [artificial intelligence] is being monetized and seems to be blasting through any lingering bear thesis concerns for now.

So, all in all, it is truly an exciting time, to say the least, for NVIDIA, the NVIDIA share price and its shareholders. But let’s see what the rest of the year brings for this US tech giant.