If you had invested $1,000 in Nvidia stock when Softbank sold its stake five years ago, here’s how much you would have now.Loading…Loading…
The AI revolution has catapulted graphics card maker Nvidia Corp. NVDA to the top five in the list of the world’s largest companies by market capitalization.
Nvidia’s rise to the top has helped it blow past Big Tech companies like Alphabet Inc.’s Google, Amazon.com Inc., Tesla Inc. and Meta Platforms Inc., among others.
Rising Tide Lifts Everyone Except Masayoshi Son’s Softbank
Whilst Nvidia co-founder Jensen Huang, investors, and employees have all reaped the rewards of the company’s rise, Masayoshi Son and his Japanese multinational investment company SoftBank Group Corp. SFTBF haven’t been as fortunate.
Despite owning a notable stake in Nvidia at one point, Son-led Softbank has failed to benefit from the graphics card maker’s rapid rise. That is because Softbank sold its entire stake in Nvidia for $3.3 billion in January 2019.
See Also: If You Invested $1000 In Nvidia When It Released The World’s First Official GPU 25 Years Ago, Here’s How Much You’d Have
While Nvidia stock witnessed slow but steady movement for the first two years since Softbank’s stake sale, it started gaining momentum during the COVID-19 pandemic in 2020.
However, it wasn’t until Microsoft Corp.-backed MSFT OpenAI’s ChatGPT went viral at the beginning of 2023 that Nvidia stock entered a bull run.
In the last year, Nvidia’s shares have witnessed a hockey-stick-shaped surge.
Now, let’s examine how Nvidia stock has fared since Softbank, led by Son, sold its stake five years ago.
Nvidia shares were trading at $36.1825 on Feb. 1, 2019, adjusted for stock splits and other corporate actions.
Its stock price today is $722.48, which is an increase of 1,897% during this period.
If you had invested $1,000 in Nvidia stock on Feb. 1, 2019, today, you would have $19,968.
Likewise, if you had invested $1,000 in an index fund replicating Nasdaq, you would have $2,811.
A similar $1,000 investment in an index fund replicating the S&P 500 would be worth $1,975.
Loading…Loading…Riding The AI Boost
Gamers and content creators were amongst Nvidia’s primary customers for the better part of three decades since the launch of the first official graphics processing unit (GPU), the GeForce 256 in 1999.
However, Huang and his team have since found two different use cases, and the company has ridden both waves – cryptocurrency mining and artificial intelligence.
Nvidia’s primary focus is now on delivering new technologies tailored for the age of Generative AI. Huang predicts that “accelerated” data centers in the world will double from the existing $1 trillion to $2 trillion by 2029.
“All of these data centers will be ‘accelerated’. This architecture for ‘Accelerated Computing’ is ideal for this next-generation of software called Generative AI, so that’s really at the core of what’s happening.”
Nvidia is currently flooded with orders for its H100 AI GPU. It also showcased the next-generation H200 AI GPU, which is estimated to cost between $25,000 and $ 40,000 and features 141GB of next-generation memory. Nvidia expects to start shipping it in the second quarter of 2024.
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Photo courtesy: Nobuyuki Hayashi on Shutterstock
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