The market’s comeback from April lows has been spearheaded by tech stocks, and Wall Street continued to look for new benchmarks for well-known companies this week.
Nvidia Corp.’s (NVDA) stock closed Friday at a new all-time high of $157.75, up 10.7% this week. According to Dow Jones Market Data, the chip manufacturer has made almost $1.42 trillion since closing at its lowest point of the year in April. This week, Nvidia overtook Microsoft Corp. (MSFT) as the world’s most valuable public corporation thanks to its comeback.
Following five days of increases, Nvidia’s market capitalization stood at $3.8 trillion as of Friday’s market close, up 61.8% from the S&P 500’s SPX recent low on April 8, according to Dow Jones Market Data. According to the data, Microsoft has increased 40% from its April low and now has a market valuation of $3.7 trillion.
In a note to clients on Friday, Wedbush analysts lead by Dan Ives stated that both businesses are getting closer to the “monumental achievement” of a $4 trillion market cap. Because “this tech bull market is still early being led by the AI Revolution,” the analysts predict that Nvidia and Microsoft will hit the milestone this summer and then aim for the $5 trillion mark over the following 18 months.
“The poster [children] for the AI Revolution are led by Nvidia and Microsoft as both are foundational pieces of building on the biggest tech trend we have seen in our 25 years covering tech stocks on the Street,” said the team at Wedbush.
According to Wedbush, Advanced Micro Devices Inc. (AMD) will soon overtake Nvidia as the leading supplier of AI chips. As of Friday’s close, the chip maker was up 83.9% from the April 8 low, making it one of the S&P 500’s best performers since then, according to Dow Jones Market Data.
Additionally, the analysts noted that although Microsoft has led hyperscalers in “this first key phase of the AI Revolution,” Alphabet Inc.’s (GOOGL) (GOOG), Google, and Amazon Web Services (AMZN) divisions have also had “major cloud and AI momentum.”
Wedbush, meanwhile, has set trillions of dollars lower projections for Nvidia than Loop Capital analyst Ananda Baruah did in a note to investors earlier this week.
“We are entering the next ‘Golden Wave’ of Gen AI adoption and [Nvidia] is at the front end of another material leg of stronger-than-anticipated demand,” Baruah stated in the note, as reported by Bloomberg.
Baruah increased his price objective for Nvidia from $175 to $250, resulting in a $6 trillion valuation, or a roughly 58% increase from Friday’s market capitalization.
Barclays analysts were likewise optimistic about Nvidia earlier this month, increasing their price target to $200 based on their positive assessment of the chip maker’s expansion of its Blackwell AI platform. Nvidia would have a $4.9 trillion market capitalization at that pricing. Nvidia “has the most potential upside in our coverage” for the second half of the year, according to Barclays.
According to Dow Jones Market Data, Micron Technology Inc. (MU) closed Friday up 90.4% from the index’s closing low on April 8 and has been one of the S&P 500’s best performers so far this month.
The demand for the memory chip manufacturer’s high-bandwidth memory (HBM) chips, which are required by AI chip developers, exceeded Wall Street’s forecasts in the May quarter financial reports.
Micron reported that sales of its dynamic random-access memory chips, which included a roughly 50% sequential rise in revenue for its HBM chips, were “driven by all-time-high” revenue in the third quarter of its fiscal year.
Jordan Klein, a desk-based analyst at Mizuho Securities, stated in a pre-earnings note that “the HBM density rises materially,” which is favorable for Micron and other HBM chip providers, given that Nvidia’s next-generation Blackwell Ultra chips are anticipated to arrive later this year or early next year.
