NVDA is following Tesla and is on track to become the next trillion $ company by market cap.
The year is 2022. You wake up on a cold Mid-February weekend morning and sip a warm cup of tea (not coffee that's just gross). You have a great idea of building a gaming PC! You get so excited about the thought of finally being able to build a good old PC. You have waited 2 full years through the biggest chip shortage of your lifetime. Surely Nvida has figured things out right. You open up the Best Buy App! AND! Your dreams are crushed.....
(Then you open up Robinhood and see NVDA Pushing $400 and you start to shed a tear because you thought surely there would be a dip...)
With all seriousness NVDA has done very well in recent weeks and really the past few years. As much as I love AMD, I will be the first to admit NVDA has a monopoly when it comes to graphics and AI. With the stock pushing high 290's low 300's pre earnings the price seems very dauting.
Is it Justified?
Depends who you ask. I think Tesla is a great comparison as an enormous part of both of their valuations are expected growth. If you think technology is just a short lived tik tok trend then no, it is not justified. However, many people understand Nvidia's technology and what may be possible in the future.
I did play NVDA on the pre-earnings run up, but sold out clearly way to early but cant be mad because profit is profit and I gotta eat this week. I will be looking to buy any dip on NVDA but with caution. I really do want to see NVDA's earnings on the 19th and their guidance going forward.
Disclaimer: I do own stock in NVDA & AMD. None of this is a recommendation and/or financial advice.