7 ms·

Nvidia ($960B) is now worth more than Facebook, Tesla and Netflix

62 points by redbell 3y ago

JumpinJack_Cash 3y ago
It's practically impossible that the world has changed so much in the last 6-12 months to warrant such jump in valuation. The stock market has become a meme market, today nVidia is hot...10 weeks from now it will be something else entirely that people fall in love with. I predict that all the crypto-boys will have an epiphany "if you can beat them join them" and will pump JPMorgan and Bank of America to the moon, as always completely removed from any fundamentals.
- moomoo3000 3y ago
  It was undervalued and the world has changed that much. This is not like crypto.
  - adam_arthur 3y ago
    30x sales is not undervalued. “At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?” — Scott McNealy, Business Week, 2002 The simple truth is that the people bidding it up indiscriminately have no clue about the fundamentals. You only win if you get out before reality sets in. This is not some microcap company that can eventually justify such an extreme multiple via actual growth
    - danielmarkbruce 3y ago
      The simple truth is that relying on LTM sales is something only people who don't understand the business fundamentals do. Nvidia is in a very good position in a rapidly growing market. For folks who don't understand that, it might be comforting to look at recent history for sales numbers, gross margins etc. Those numbers are practically meaningless for Nvidia 2032 financials. In 2004 "value" guys were looking at Google's IPO and calling bs. 20 years later, sales are up 100x. Market cap is up 60 or 70x. Those value guys were looking at LTM. King of value guys, Warren Buffett: "Future profitability of the industry will be determined by current competitive characteristics, not past ones. Many managers have been slow to recognize this. It’s not only generals that prefer to fight the last war. Most business and investment analysis also comes from the rear-view mirror."
      - adam_arthur 3y ago
        Yes, the future is obviously what’s important. So you make an educated guess on what the future earnings will be and work backwards from that to determine whether something is a good investment. So what is your revenue/earnings projection for NVDA and terminal multiple to justify today’s valuation. You do have one right?
        danielmarkbruce 3y ago
        Finger in the air - 10 years, $200 bill rev at 25% net income margin and 30x earnings multiple seems totally reasonable. Not a great return from current prices, but this situation is nowhere near detached from fundamentals. The only people making that claim aren't grasping the situation we are in with respect to demand for GPUs from AI and the competitive position Nvidia have managed to get themselves into. The world has changed in the last few months as far as computing is concerned.
        adam_arthur 3y ago
        So given those numbers, you are projecting to earn a 50% return in total over 10 years, or 4.1% per year. Current market cap $1T, projected market cap in 10y $1.5T given 50B net income * 30. That’s quite terrible given the commensurate risks. You aren’t pricing in at all that CPUs can be used for inference, FAANGs will compete, AMD cards will surely become viable too if the market is growing that quickly. Apple’s chips today can be used for fast LLM inference for large models, and they weren’t even designed with that intention in mind. Competitors didn’t care before because it was a small market. So how is it logical at all to invest at these prices? Even if you double the revenue projection to $400B, the total return is not very compelling over 10 years, and carries a large amount of downside risk versus alternatives. I have no doubt that people will make money playing hot potato with it over the next few months, but the stock price is likely to go nowhere over a longer timeframe. Eventually the greater fools run out
- asdajksah2123 3y ago
  > impossible that the world has changed so much in the last 6-12 months https://trends.google.com/trends/explore?geo=US&q=chatgpt&hl=en https://trends.google.com/trends/explore?geo=US&q=chatgpt&hl... Week chatgpt: (United States) 11/6/2022 0 11/13/2022 0 11/20/2022 0 11/27/2022 2 12/4/2022 40 12/11/2022 50
  - GravitasFailure 3y ago
    Exactly, and even the people most skeptical of AI don't think it's going away any time soon.
- wefarrell 3y ago
  The stock market isn't based on the present state of the world, it's based on future expectations of earnings. So no, the current state of the world hasn't changed much in the past 6-12 months but clearly perceptions of the future have.
  - JumpinJack_Cash 3y ago
    JD Rockefeller first signed off the oil revolution, then he got rich. Henry Ford first signed off the Model T and then got rich. I could go on, we used to reward practical improvment in quality of life, not just expectations . The thing about rewarding people for creating expectations is that false dawns can be natural (and they do happen), but they can also be manufactured artificially to get rich. And also quite frankly Chat-GPT is being developed in the wealthiest area in the world where everybody hangs out together in one giant Fed fueled party. If this was something as revolutionary as the wheel like many commentators said, surely the movement would have preceded the unveil not the other way around.
    - danielmarkbruce 3y ago
      It's got nothing to do with rewarding anyone. People are buying nvda because they think the company is worth a lot because future earnings are going to be much higher than today because demand for their products will be extremely high. They expect many dollars to flow back into their pockets from such purchases. They aren't trying to line Jensen's pockets, they are trying to line their own. There is nothing wrong with that logic. NVDA are extremely well placed with their chips and cuda. Demand is high. It doesn't appear to be going anywhere but up. Their competitive position is good. Maybe the price is too high, but it's not anything even approaching a meme stock. There are real fundamentals behind that valuation.
    - wefarrell 3y ago
      Rockefeller and Ford both raised significant investments before their companies practically improved quality of life and irrational speculation is as old as the stock market itself. For example during the rise of Standard Oil 1880s there was a massive speculative bubble in railroads that led to a collapse during the 1890s. Bringing up those examples without considering the failures is survivorship bias.
- lupire 3y ago
  GME, a dead company that bet it all on NFT, is still 10x the price it was before it became a meme 2 years ago.
- 2OEH8eoCRo0 3y ago
  The crypto-boys are gnats comparared to JPMorgan and BoA. I'm not even sure they could move the needle if they tried.
- CamperBob2 3y ago
  It's practically impossible that the world has changed so much in the last 6-12 months to warrant such jump in valuation. We're on the threshold of the mother of all gold rushes, and everybody else's shovels are made out of either rubber or Chinese pot metal. So, yes, Nvidia is in a very good position right now. About the only things that can derail them are war in Taiwan or the appearance of new techniques that make inference computationally very cheap.
  - anankaie 3y ago
    > appearance of new techniques that make inference computationally very cheap So long as training (computation of the gradient and update) remains expensive, nVidia - and others - will be fine. At the moment, between the global cloud providers and smaller players, there appears to be effectively "unlimited" demand for GPUs. This is likely to continue, as ML gets used for more and more things. Remember - the GPTs are the new hotness, and certainly hog their share of GPUs right now, but there are a lot of models just quietly working without making anywhere near the splash; all of these need GPUs too.
2OEH8eoCRo0 3y ago
Seems weird for a hardware company who doesn't build the hardware or fab the chips to be worth that much. Their supply chain looks extremely risky (Taiwan) and some of their competitors do have their own fabs.
- nitinreddy88 3y ago
  Neither Apple has it's own fab nor AMD.
  - 2OEH8eoCRo0 3y ago
    It feels like a bubble because really Apple, AMD, and Nvidia owe a lot of their success to TSMC's node shrinking magic.
- justinclift 3y ago
  Which competitors own their own fabs?
  - kimixa 3y ago
    Intel. They've made big noise about future GPU and compute products; We'll see if they're actually "competition" in this sector when they actually get released in competitive SKUs. Though many of those products may end up using TSMC too, but that's an option Intel have likely chosen for capacity/price/performance issues, rather than a hard requirement.
    - justinclift 3y ago
      Good point, I'd forgotten about them. :)
- Ekaros 3y ago
  It is strange that the market cap of companies that make parts of the shovels have not had same trajectory. Or even fraction of it. Shovel maker can't sell shovels if they don't have parts to make them.
nologic01 3y ago
Its all just an overheated market that has zero ability to project the future tech landscape yet suffers enormous FOMO Will AI be "big" business? Under what business model. And who will benefit? Will Nvidia be the only one selling shovels? And how many will be buying shovels and to what end? Does Mr Market project that AI is going to get "democratized"? Who will be running AI models and what have they being doing until now without high end GPU's? Everything is up in the air and that includes the stock price
- ffgjgf1 3y ago
  I guess from Nvidia’s perspective a lot of those thing don’t really matter as long as the people making/using “AI” need hardware. As long as Nvidia is a semi-monopoly it’s probably one of the safest bets in that way
  - nologic01 3y ago
    There are echoes of the cryptomania boom here. Nvidia had the field for itself there too. The question is how soon, how fast, how widespread, in what shape and how lucrative the permanent adoption of AI algorithms. For example, if the largest models are trained and shared as open source and only inference is done locally, its dominant position will be erode much faster. On the other hand if only a few supersized entities train large models and serve them through API's they will eventually have their own datacenter chips. Ultimately the Nvidia booms and busts reflect the lack of serious competition in this space. Once the previous oligopolist made the wrong calls on multi-core CPU designs, the field was left wide open. The more general challenge for these players is how their offering will land in the post-Moore's law landscape. These accelerator type chips are hard to program, consume lots of electricity and are good for very specific tasks. The mechanics and economics of the mass market CPU era dont apply. Grab your pop corn.
    - ffgjgf1 3y ago
      > For example, if the largest models are trained and shared as open source and only inference is done locally, its dominant position will be erode much faster. Open source models would still need to be trained on Nvidia’s HW? I agree with your other points though, if the market becomes heavily concentrated I just don’t see the larger companies not developing their own chips/funding Nvidia’s competitors. Data center seems to be fundamentally different from the gaming market in the way that price/performance is the only thing that really matters. Which would imply that it should be easier for other competitors to challenge Nvidia.
RcouF1uZ4gsC 3y ago
In a gold rush, the way to make money is to sell shovels. NVidia is the ultimate shovel seller for AI with decades of investment (see CUDA).
- deleted 3y ago
  [deleted]
HWR_14 3y ago
In case anyone here took the Inverse-Cramer investing method seriously, he was advocating people dump NVIDIA 8 months ago. If you bought then you tripled your money.
- prng2021 3y ago
  He’ll never admit it but he’s really a day trader. I wouldn’t be surprised if he has changed his stance on Nvidia numerous times over that timeframe.
  - HWR_14 3y ago
    I don't know if he is a day trader. He does have a daily show that requires him to have new opinions every day.
    - mikeweiss 3y ago
      This.... He's a TV Personality and entrepreneur
- diamond559 3y ago
  What? He's been the biggest bull for Nvidia for months. Guy changes his mind a lot.
- worklaptopacct 3y ago
  Looks like that ETF is just noise[0]. I've never followed Cramer, but this pretty much fits the narrative that he's just saying random things. If he's throwing around random opinions about given stock, then it's not difficult to cherry pick that one case when he was wrong at a right time. [0] https://www.crameretfs.com/sjim https://www.crameretfs.com/sjim
  - HWR_14 3y ago
    The ETF seems to be a bad idea because of how it's run. That's different from people who advocate "Always bet against Cramer", who say that as a strategy and on who the ETF is based.
Nifty3929 3y ago
Not exactly. All these “market cap” exercises just take whatever the last trade happened to be, for some relatively small number of shares, and then multiply it by the total number of shares. This is an okay, but far from perfect, way to value a company. This is why when a company is purchased in entirety, it’s often at a large premium or discount to the market cap. Is Nvidia really worth about 1T? Maybe, likely not though. I think most people would rather have one third of Apple than all of Nvidia.
- osti 3y ago
  A lot of people will rather own a third of Apple, but the market, thus by extension, most people who actually invest, think that Nvidia is worth a third of Apple, on last Friday at least.
  - Nifty3929 3y ago
    No, that is not at all what it means - that’s my point. All of Nvidia was not purchased in Friday, and neither was 1/3 if Apple. We don’t really know what those things are worth, because we do not have such a transaction. To base that on. All we know is what a bunch of individuals would buy or sell a small number of shares for. Very different.
    - suddenclarity 3y ago
      I think it's a lost cause. People don't want to understand. It would shatter their worldview on both net worth of the rich (you can't tax imaginary money) and their own net worth.
      - osti 3y ago
        Market value is a basis for most modern accounting and finance theory, so there isn't anything outrageous about it, otherwise people would have changed how finance is taught long ago.
        3y ago
fuzzfactor 3y ago
Did anyone read this thread: https://twitter.com/petergyang/status/1662831418882560000 https://twitter.com/petergyang/status/1662831418882560000 >May 28 >9/ Jensen wrapped up the speech with this: "Run don't walk. Either you're running for food, or you are running from being food: 1. Have the humility to confront failure and ask help. 2. Endure the pain needed to realize your dream. 3. Make sacrifices for your life's work."
- familyguythrow1 3y ago
  [flagged]
im3w1l 3y ago
Regarding his point 2 about cuda, I remember in the early days of computation on the gpu there were no such luxuries. People would formulate their problems as say a pixel shader, and use a texture as input and read an image as output. Was called gpgpu. So cuda was basically a way of making an existing practice easier.
LatteLazy 3y ago
I wsh people would not just say worth = market cap = share price * share outstanding ...
1letterunixname 3y ago
Here's a fundamental: Meta is spending $10B/year on NVIDIA. You can bet Microsoft will be spending $15B/yr, Apple probably $3B, and the US Gov $2-5B. Anyone who wants to get in on AI or HPC is going to buy NVIDIA headless GPUs. The reason no one uses ATI is because their dev support is a disaster.

62 points by redbell 3y ago

It's practically impossible that the world has changed so much in the last 6-12 months to warrant such jump in valuation. The stock market has become a meme market, today nVidia is hot...10 weeks from now it will be something else entirely that people fall in love with. I predict that all the crypto-boys will have an epiphany "if you can beat them join them" and will pump JPMorgan and Bank of America to the moon, as always completely removed from any fundamentals.

moomoo3000 3y ago
It was undervalued and the world has changed that much. This is not like crypto.
- adam_arthur 3y ago
  30x sales is not undervalued. “At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don’t need any transparency. You don’t need any footnotes. What were you thinking?” — Scott McNealy, Business Week, 2002 The simple truth is that the people bidding it up indiscriminately have no clue about the fundamentals. You only win if you get out before reality sets in. This is not some microcap company that can eventually justify such an extreme multiple via actual growth
  - danielmarkbruce 3y ago
    The simple truth is that relying on LTM sales is something only people who don't understand the business fundamentals do. Nvidia is in a very good position in a rapidly growing market. For folks who don't understand that, it might be comforting to look at recent history for sales numbers, gross margins etc. Those numbers are practically meaningless for Nvidia 2032 financials. In 2004 "value" guys were looking at Google's IPO and calling bs. 20 years later, sales are up 100x. Market cap is up 60 or 70x. Those value guys were looking at LTM. King of value guys, Warren Buffett: "Future profitability of the industry will be determined by current competitive characteristics, not past ones. Many managers have been slow to recognize this. It’s not only generals that prefer to fight the last war. Most business and investment analysis also comes from the rear-view mirror."
    - adam_arthur 3y ago
      Yes, the future is obviously what’s important. So you make an educated guess on what the future earnings will be and work backwards from that to determine whether something is a good investment. So what is your revenue/earnings projection for NVDA and terminal multiple to justify today’s valuation. You do have one right?
      - danielmarkbruce 3y ago
        Finger in the air - 10 years, $200 bill rev at 25% net income margin and 30x earnings multiple seems totally reasonable. Not a great return from current prices, but this situation is nowhere near detached from fundamentals. The only people making that claim aren't grasping the situation we are in with respect to demand for GPUs from AI and the competitive position Nvidia have managed to get themselves into. The world has changed in the last few months as far as computing is concerned.
        adam_arthur 3y ago
        So given those numbers, you are projecting to earn a 50% return in total over 10 years, or 4.1% per year. Current market cap $1T, projected market cap in 10y $1.5T given 50B net income * 30. That’s quite terrible given the commensurate risks. You aren’t pricing in at all that CPUs can be used for inference, FAANGs will compete, AMD cards will surely become viable too if the market is growing that quickly. Apple’s chips today can be used for fast LLM inference for large models, and they weren’t even designed with that intention in mind. Competitors didn’t care before because it was a small market. So how is it logical at all to invest at these prices? Even if you double the revenue projection to $400B, the total return is not very compelling over 10 years, and carries a large amount of downside risk versus alternatives. I have no doubt that people will make money playing hot potato with it over the next few months, but the stock price is likely to go nowhere over a longer timeframe. Eventually the greater fools run out
asdajksah2123 3y ago
> impossible that the world has changed so much in the last 6-12 months https://trends.google.com/trends/explore?geo=US&q=chatgpt&hl=en https://trends.google.com/trends/explore?geo=US&q=chatgpt&hl... Week chatgpt: (United States) 11/6/2022 0 11/13/2022 0 11/20/2022 0 11/27/2022 2 12/4/2022 40 12/11/2022 50
- GravitasFailure 3y ago
  Exactly, and even the people most skeptical of AI don't think it's going away any time soon.
wefarrell 3y ago
The stock market isn't based on the present state of the world, it's based on future expectations of earnings. So no, the current state of the world hasn't changed much in the past 6-12 months but clearly perceptions of the future have.
- JumpinJack_Cash 3y ago
  JD Rockefeller first signed off the oil revolution, then he got rich. Henry Ford first signed off the Model T and then got rich. I could go on, we used to reward practical improvment in quality of life, not just expectations . The thing about rewarding people for creating expectations is that false dawns can be natural (and they do happen), but they can also be manufactured artificially to get rich. And also quite frankly Chat-GPT is being developed in the wealthiest area in the world where everybody hangs out together in one giant Fed fueled party. If this was something as revolutionary as the wheel like many commentators said, surely the movement would have preceded the unveil not the other way around.
  - danielmarkbruce 3y ago
    It's got nothing to do with rewarding anyone. People are buying nvda because they think the company is worth a lot because future earnings are going to be much higher than today because demand for their products will be extremely high. They expect many dollars to flow back into their pockets from such purchases. They aren't trying to line Jensen's pockets, they are trying to line their own. There is nothing wrong with that logic. NVDA are extremely well placed with their chips and cuda. Demand is high. It doesn't appear to be going anywhere but up. Their competitive position is good. Maybe the price is too high, but it's not anything even approaching a meme stock. There are real fundamentals behind that valuation.
  - wefarrell 3y ago
    Rockefeller and Ford both raised significant investments before their companies practically improved quality of life and irrational speculation is as old as the stock market itself. For example during the rise of Standard Oil 1880s there was a massive speculative bubble in railroads that led to a collapse during the 1890s. Bringing up those examples without considering the failures is survivorship bias.
lupire 3y ago
GME, a dead company that bet it all on NFT, is still 10x the price it was before it became a meme 2 years ago.
2OEH8eoCRo0 3y ago
The crypto-boys are gnats comparared to JPMorgan and BoA. I'm not even sure they could move the needle if they tried.
CamperBob2 3y ago
It's practically impossible that the world has changed so much in the last 6-12 months to warrant such jump in valuation. We're on the threshold of the mother of all gold rushes, and everybody else's shovels are made out of either rubber or Chinese pot metal. So, yes, Nvidia is in a very good position right now. About the only things that can derail them are war in Taiwan or the appearance of new techniques that make inference computationally very cheap.
- anankaie 3y ago
  > appearance of new techniques that make inference computationally very cheap So long as training (computation of the gradient and update) remains expensive, nVidia - and others - will be fine. At the moment, between the global cloud providers and smaller players, there appears to be effectively "unlimited" demand for GPUs. This is likely to continue, as ML gets used for more and more things. Remember - the GPTs are the new hotness, and certainly hog their share of GPUs right now, but there are a lot of models just quietly working without making anywhere near the splash; all of these need GPUs too.

2OEH8eoCRo0 3y ago

Seems weird for a hardware company who doesn't build the hardware or fab the chips to be worth that much. Their supply chain looks extremely risky (Taiwan) and some of their competitors do have their own fabs.

nitinreddy88 3y ago
Neither Apple has it's own fab nor AMD.
- 2OEH8eoCRo0 3y ago
  It feels like a bubble because really Apple, AMD, and Nvidia owe a lot of their success to TSMC's node shrinking magic.
justinclift 3y ago
Which competitors own their own fabs?
- kimixa 3y ago
  Intel. They've made big noise about future GPU and compute products; We'll see if they're actually "competition" in this sector when they actually get released in competitive SKUs. Though many of those products may end up using TSMC too, but that's an option Intel have likely chosen for capacity/price/performance issues, rather than a hard requirement.
  - justinclift 3y ago
    Good point, I'd forgotten about them. :)
Ekaros 3y ago
It is strange that the market cap of companies that make parts of the shovels have not had same trajectory. Or even fraction of it. Shovel maker can't sell shovels if they don't have parts to make them.

nologic01 3y ago

Its all just an overheated market that has zero ability to project the future tech landscape yet suffers enormous FOMO Will AI be "big" business? Under what business model. And who will benefit? Will Nvidia be the only one selling shovels? And how many will be buying shovels and to what end? Does Mr Market project that AI is going to get "democratized"? Who will be running AI models and what have they being doing until now without high end GPU's? Everything is up in the air and that includes the stock price

ffgjgf1 3y ago
I guess from Nvidia’s perspective a lot of those thing don’t really matter as long as the people making/using “AI” need hardware. As long as Nvidia is a semi-monopoly it’s probably one of the safest bets in that way
- nologic01 3y ago
  There are echoes of the cryptomania boom here. Nvidia had the field for itself there too. The question is how soon, how fast, how widespread, in what shape and how lucrative the permanent adoption of AI algorithms. For example, if the largest models are trained and shared as open source and only inference is done locally, its dominant position will be erode much faster. On the other hand if only a few supersized entities train large models and serve them through API's they will eventually have their own datacenter chips. Ultimately the Nvidia booms and busts reflect the lack of serious competition in this space. Once the previous oligopolist made the wrong calls on multi-core CPU designs, the field was left wide open. The more general challenge for these players is how their offering will land in the post-Moore's law landscape. These accelerator type chips are hard to program, consume lots of electricity and are good for very specific tasks. The mechanics and economics of the mass market CPU era dont apply. Grab your pop corn.
  - ffgjgf1 3y ago
    > For example, if the largest models are trained and shared as open source and only inference is done locally, its dominant position will be erode much faster. Open source models would still need to be trained on Nvidia’s HW? I agree with your other points though, if the market becomes heavily concentrated I just don’t see the larger companies not developing their own chips/funding Nvidia’s competitors. Data center seems to be fundamentally different from the gaming market in the way that price/performance is the only thing that really matters. Which would imply that it should be easier for other competitors to challenge Nvidia.

RcouF1uZ4gsC 3y ago

In a gold rush, the way to make money is to sell shovels. NVidia is the ultimate shovel seller for AI with decades of investment (see CUDA).

deleted 3y ago
[deleted]

HWR_14 3y ago

In case anyone here took the Inverse-Cramer investing method seriously, he was advocating people dump NVIDIA 8 months ago. If you bought then you tripled your money.

prng2021 3y ago
He’ll never admit it but he’s really a day trader. I wouldn’t be surprised if he has changed his stance on Nvidia numerous times over that timeframe.
- HWR_14 3y ago
  I don't know if he is a day trader. He does have a daily show that requires him to have new opinions every day.
  - mikeweiss 3y ago
    This.... He's a TV Personality and entrepreneur
diamond559 3y ago
What? He's been the biggest bull for Nvidia for months. Guy changes his mind a lot.
worklaptopacct 3y ago
Looks like that ETF is just noise[0]. I've never followed Cramer, but this pretty much fits the narrative that he's just saying random things. If he's throwing around random opinions about given stock, then it's not difficult to cherry pick that one case when he was wrong at a right time. [0] https://www.crameretfs.com/sjim https://www.crameretfs.com/sjim
- HWR_14 3y ago
  The ETF seems to be a bad idea because of how it's run. That's different from people who advocate "Always bet against Cramer", who say that as a strategy and on who the ETF is based.

Nifty3929 3y ago

Not exactly. All these “market cap” exercises just take whatever the last trade happened to be, for some relatively small number of shares, and then multiply it by the total number of shares. This is an okay, but far from perfect, way to value a company. This is why when a company is purchased in entirety, it’s often at a large premium or discount to the market cap. Is Nvidia really worth about 1T? Maybe, likely not though. I think most people would rather have one third of Apple than all of Nvidia.

osti 3y ago
A lot of people will rather own a third of Apple, but the market, thus by extension, most people who actually invest, think that Nvidia is worth a third of Apple, on last Friday at least.
- Nifty3929 3y ago
  No, that is not at all what it means - that’s my point. All of Nvidia was not purchased in Friday, and neither was 1/3 if Apple. We don’t really know what those things are worth, because we do not have such a transaction. To base that on. All we know is what a bunch of individuals would buy or sell a small number of shares for. Very different.
  - suddenclarity 3y ago
    I think it's a lost cause. People don't want to understand. It would shatter their worldview on both net worth of the rich (you can't tax imaginary money) and their own net worth.
    - osti 3y ago
      Market value is a basis for most modern accounting and finance theory, so there isn't anything outrageous about it, otherwise people would have changed how finance is taught long ago.
      - 3y ago

fuzzfactor 3y ago

Did anyone read this thread: https://twitter.com/petergyang/status/1662831418882560000 https://twitter.com/petergyang/status/1662831418882560000 >May 28 >9/ Jensen wrapped up the speech with this: "Run don't walk. Either you're running for food, or you are running from being food: 1. Have the humility to confront failure and ask help. 2. Endure the pain needed to realize your dream. 3. Make sacrifices for your life's work."

familyguythrow1 3y ago
[flagged]

im3w1l 3y ago

Regarding his point 2 about cuda, I remember in the early days of computation on the gpu there were no such luxuries. People would formulate their problems as say a pixel shader, and use a texture as input and read an image as output. Was called gpgpu. So cuda was basically a way of making an existing practice easier.

LatteLazy 3y ago

I wsh people would not just say worth = market cap = share price * share outstanding ...

1letterunixname 3y ago

Here's a fundamental: Meta is spending $10B/year on NVIDIA. You can bet Microsoft will be spending $15B/yr, Apple probably $3B, and the US Gov $2-5B. Anyone who wants to get in on AI or HPC is going to buy NVIDIA headless GPUs. The reason no one uses ATI is because their dev support is a disaster.