JUNE 10, 2024
Today marks a key event that many investors have been waiting for. Nvidia (NASDAQ:NVDA), the artificial intelligence (AI) leader dominating the tech sector, begins trading on a split-adjusted basis. After weeks of anticipation, NVDA stock now trades at a much lower price.
As of this writing, it is trading at $120 per share after closing out trading last week at more than $1200. Investors who held shares last week have seen their holdings increase, as the company has issued 10 shares for each previous one. They haven’t lost money, but they stand to make more when the new stock returns to its previous levels.
NVDA on a Post-Split Basis
NVDA stock dipped slightly in pre-market trading today. While it is currently still down, the stock is likely to pick up momentum soon.
For anyone who didn’t purchase Nvidia prior to the launch of ChatGPT in November 2022, which sent it soaring, this is a chance to add it to their portfolio. Companies enact stock splits to organically lower share prices to make them more accessible to new investors, and there is likely no shortage of people who want to acquire NVDA stock.
One interesting factor to consider is that NVDA stock traded at $120 per share less than two years ago. In October 2022, before OpenAI debuted ChatGPT and sent AI stocks into new territory, it hovered right around that price. Since then, the tech sector leader has enjoyed a 900% growth rate, dominating markets and ushering in a new wave of industry. And plenty of experts believe it will continue rising from here. As MarketWatch reports:
“For investors who think Nvidia already rules the S&P 500 SPX, Evercore ISI analyst Mark Lipacis outlined a path for the stock to become even more dominant within the index. Nvidia has a similar weighting to Apple Inc. within the S&P 500, at around 6% to 7%, he flagged. But Lipacis thinks Nvidia’s weighting could grow to 10% to 15% as the market is still in the midst of a transition into a new computing era.”
Analysts Remain Bullish on NVDA Stock
Other Wall Street firms remain as bullish on NVDA stock as ever. Just today, analysts from both Barclays and Susquehanna raised their price targets, while one from TD Cowen updated his “buy” rating. The stock still receives a “strong buy consensus” on TipRanks, with 37 out of 40 analysts calling it a “buy.”
Even while short bets on Nvidia stock increased ahead of the stock split, most experts clearly aren’t worried about the company’s growth prospects as it adjusts to trading on a split-adjusted basis.
Courtesy: InvestorPlace
