Nvidia Has Added $1.8 Trillion of Market Cap in 2024. Here’s How Big That is.

As the first half of 2024 concludes, Nvidia Corp. continues to impress with remarkable growth statistics. According to Dow Jones Market Data, the semiconductor giant has increased its market capitalization by $1.827 trillion this year. Besides Nvidia, only four other U.S. companies have valuations exceeding this figure: Microsoft Corp., Apple Inc., Alphabet Inc., and Amazon.com Inc.

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Nvidia's market-cap growth for the first half of 2024 is also larger than the combined valuations of the 137 smallest companies in the S&P 500, highlighting its significant expansion.

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Additionally, Nvidia’s market-cap gains are notable on a quarterly basis. In the second quarter alone, Nvidia is set to add $791 billion to its market cap, according to Dow Jones Market Data. Excluding Nvidia, only seven U.S. companies surpass this valuation: Microsoft, Apple, Alphabet, Amazon, Meta Platforms Inc., Berkshire Hathaway Inc., and Eli Lilly & Co.

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In terms of stock performance, Nvidia’s gains rank second in the S&P 500 for both the first half and the second quarter of 2024, with increases of 150% and 38%, respectively, through Thursday's close. Super Micro Computer Inc. has outperformed Nvidia on a year-to-date basis with a 213% increase, while First Solar Inc. leads Nvidia in quarter-to-date gains with a 48% rise.

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The big question is whether Nvidia can sustain this rally. On Friday, Nvidia shares rose by 1.4%, although they fell by 1.9% on Thursday, a challenging day for chip stocks but favorable for software stocks. On Thursday, significant gains in software stocks like Palo Alto Networks Inc. and Salesforce Inc. indicated a shift by some investors from semiconductor to software stocks, noted Jordan Klein, an analyst at Mizuho.

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Klein emphasized that this shift does not imply trouble for semiconductor stocks or a recommendation to sell. However, he pointed out that the ongoing rallies in large software companies like Adobe Inc. and Salesforce could tempt fund managers, who missed out on these rallies, to start investing in them.

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Nvidia's exceptional performance has placed it among the top echelons of U.S. companies in terms of market value, showcasing its dominance and growth potential in the semiconductor industry. The company's ability to sustain its rally will depend on market dynamics and investor sentiment, especially as some investors may rotate their focus towards other high-performing sectors like software.

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Nvidia's achievements in market capitalization underscore its influence and success in the tech industry, demonstrating significant investor confidence. As the company continues to navigate the competitive landscape, its future performance will be closely watched by investors and market analysts alike.

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