Advice on what to buy from the CEO who has achieved the greatest success in recent years. Jensen Huang, Nvidia’s CEO, has once again invited investors to bet on his company. To some, this may seem like the classic case of a wine merchant praising his own wine. However, given that the speaker is a prominent public figure, it may be worth listening to him before making a decision.
Jensen Huang spoke on the sidelines of the presentation of the Van Fleet Award, offering advice to shareholders with one notable merit: using his own company’s money, he did exactly the same thing just yesterday.
Buy my shares
Jensen Huang’s argument is simple: Nvidia is currently undervalued. In fact, its board authorized an additional $150 billion in share purchases, making it the largest buyback plan in the US stock markets.
Huang is offering the public the same medicine:
Nvidia is inexpensive right now. It is a unique company; it is already the largest in the world and, at the same time, one of the fastest-growing companies in the world. It is not natural for a company like ours to grow so quickly. And this may have made the markets somewhat suspicious.
Nvidia is effectively the world’s most valuable company by market capitalization and has surpassed Apple, which ranks second, by more than $500 billion. Despite this, Nvidia’s CEO believes there is still room for the group’s shares to grow.
Nvidia’s board has decided to invest $150 billion in excess cash in periodic buybacks of its own stock. As the Americans would say, Huang is backing up his words with actions.
Nvidia’s incredible trajectory at the heart of the AI movement
Nvidia’s trajectory remains absolutely extraordinary. The group now has a market capitalization of approximately $5.5 trillion, while the rest of the US tech sector remains at a considerable distance.
| Company | Market capitalization |
|---|---|
| NVIDIA | $5.585 B |
| Apple | $4.853 B |
| Alphabet (Google) | $4.116 B |
| Microsoft | $3.793 B |
| Amazon | $2.661 B |
| TSMC | $2.372 B |
| SpaceX | $1.960 B |
| Meta Platforms | $1.843 B |
Despite its record market capitalization, Nvidia would still be a good deal according to Huang. He believes that the recent slowdown, or misalignment, between the company’s expected growth and the stock’s performance is due to a lack of market confidence in the potential of a company that is already at the top of the world.
For skeptics, Nvidia will have to sustain the AI cycle at any cost
Nvidia’s commitments in this area have been numerous: from the $500 billion plan—representing maximum coverage, not actual investments—to support those seeking to build data centers, to the recent release of software to stop agents that take too many liberties. It is clear that Nvidia is seeking to protect the entire supply chain, the same supply chain that has enabled it to become a company of this size.
For the more cynical, this is a way to preserve a dominant position, including through the “imposition” of the CUDA standard. For others, these are standard practices for managing its market. Ultimately, the simplest figures will always matter most: revenue and margins.
