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Nvidia is now a $1T company

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Re: Nvidia is now a $1T company

#111

Post by vinyl7 »

malpanim wrote: post #9
alberth wrote: post #5

Wow, 213x P/E ratio. To put this into context with other large tech companies: P/E MARKET CAP Salesforce 1,036x $0.2T AMD 519x $0.2T NVIDIA 213x $1.0T Amazon 293x $1.25T Microsoft 35x $2.4T Meta/FB 33x $0.7T Apple 30x $2.7T Google 27x $1.5T TSMC 16x $0.4T Samsung 10x $0.3T EDIT: "P/E" ratio is the Market Cap "Price" / Earnings the company generates. E.g. Samsung is generating $30B in earnings (not revenue, earnings),…

Why TSMC is having such a low PE. Aren't they are the one producing all these chips other than Intel?

The market has been detached from reality for quite a while now

Re: Nvidia is now a $1T company

#113

Post by BasedAnon »

Just a reminder that various AI algorithms have significant influence over markets to the point that it has by proxy fundamentally changed world culture in significant ways.

Everyone looking at the P/E ratio doesn't realize that this isn't simply a speculative bubble. Rather, this is a collective superintelligence bootstrapping itself, the market will just become another data pipeline at that point.

Re: Nvidia is now a $1T company

#115

Post by hoosieree »

lotsofpulp wrote: post #94
hoosieree wrote: post #57

Earlier quoted context omitted.

> how is Apple the most valuable one You misspelled Saudi Aramco.

Saudi Aramco is currently multiple hundreds of millions behind Apple and Microsoft. https://companiesmarketcap.com/

I stand corrected, thanks.

Re: Nvidia is now a $1T company

#116

Post by partiallypro »

Sohcahtoa82 wrote: post #98
partiallypro wrote: post #66

I've sold my stock, so it will obviously keep going higher. That being said, I don't see how it's a sustainable price, it has massive P/E and Price to Sales ratio. In the past when a stock finally hits the $1 or $2 trillion mark the stock will give it up relatively quickly before it finally reclaims it for good. AI is the new "blockchain" in terms of the level of hype it is getting where every company now can mention…

> AI is the new "blockchain" in terms of the level of hype In terms of hype, I'd agree. The difference is that AI is useful.

That is obvious, I just mean that many companies that don't have, and won't have, any AI competencies are now mentioning AI in their earnings calls. I saw someone had done a chart of earnings calls that mention AI and it has skyrocketed. Also a new trend of stuffing GPT and LLMs into apps that don't need it is already in the pipeline, people comment it on HN all the time.

Re: Nvidia is now a $1T company

#117

Post by lumost »

Sohcahtoa82 wrote: post #95
lumost wrote: post #44

Earlier quoted context omitted.

TSMC is capex heavy. They will see margin compression with higher interest rates, at least in perception - their most over intel is only their ability to efficiently deploy capital.

Isn't being CapEx heavy a sign of constant expansion, though? I would think that selling (or choosing not to buy) a stock because their P/E is low because their CapEx is high is short-sighted unless you don't think their CapEx spending is going to pay off. It's like...back in 2012, I was talking to one of my wife's relatives at a Christmas party. He said he'd never buy Amazon stock because they've never been profitab…

Software R&D is a special type of capex, in principal - successful R&D execution buys recurring free cash flow in near perpetuity. Contrast this with TSMC who needs to outlay ~50 Billion every 2 years on a new Fab which will deprecate over ~6-7 years. If TSMC stopped buying fabs, then intel would beat them in ~2 years time - and TSMC would be out of business in 6-7 years.

Software R&D may be less efficient then the above math would imply, but there is a big range between perpetuity and some depreciating time horizon. R&D can also boosts growth prospects by expanding markets.

Re: Nvidia is now a $1T company

#118

Post by st380752143 »

candiddevmike wrote: post #92
paulmd wrote: post #84

Earlier quoted context omitted.

> folks hate their pricing and will gladly jump ship to whatever is cheaper with feature parity. ... Folks are only staying because CUDA has no equivalent (for now). ah yes, consistent long-term delivery of realized customer value, the shakiest of moats

When most folks are using CUDA indirectly via library abstractions, swapping it out eventually becomes easy and their moat fades away. CUDA alternatives are innovating pretty fast, and the ever present threat of TPUs and things like Apple's Neural Engine aren't helping them. They should've been building better partnerships and giving more margin away for integration and OEM instead of being greedy. But that wouldn't…

>> CUDA alternatives are innovating pretty fast What's the alternatives?

Re: Nvidia is now a $1T company

#119

Post by cykros »

arroz wrote: post #45
nixcraft wrote: post #20

Earlier quoted context omitted.

TSMC is at risk due to geopolitical tensions, particularly between China and the USA. These risks led to Warren Buffett's Berkshire Hathaway selling its stake in TSMC. Investors are worried about that. That s my best guess. Apple also opened three factories in India and other places to mitigate this risk.

Well NVIDIA depends entirely on TSMC

NVIDIA also depends on not getting the Micron treatment from China. Or even not having China take a particularly hard line on their Micron policy and disallowing NVIDIA to import Micron chips to use in their manufacturing produce for export from China.

But, NVIDIA's heavily exposed to the LLM craze.

Do with that what you will.

Re: Nvidia is now a $1T company

#120

Post by cykros »

Sohcahtoa82 wrote: post #95
lumost wrote: post #44

Earlier quoted context omitted.

TSMC is capex heavy. They will see margin compression with higher interest rates, at least in perception - their most over intel is only their ability to efficiently deploy capital.

Isn't being CapEx heavy a sign of constant expansion, though? I would think that selling (or choosing not to buy) a stock because their P/E is low because their CapEx is high is short-sighted unless you don't think their CapEx spending is going to pay off. It's like...back in 2012, I was talking to one of my wife's relatives at a Christmas party. He said he'd never buy Amazon stock because they've never been profitab…

CapEx intensity can boil down heavily to the industry a company is in. If a software company is doing a lot of CapEx, it's likely growing pretty quickly. If a manufacturing company is spending a similar ratio of its earnings, it may well just be treading water.

As usual with these ratio metrics, a full understanding of the industry, or at least understanding that you can't compare apples to oranges, is important.

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