Nvidia’s Volatile Journey
Nvidia Corp. (NVDA) emerged as the star stock of 2023, riding a wave of the artificial intelligence revolution that swept through markets in 2024. Despite the accolades, there was a moment of doubt when Mad Money host Jim Cramer recommended selling the stock in September 2022, citing concerns over the Ethereum merger.
The Sell Call
During a “Mad Money” episode on Sept. 19, 2022, Cramer expressed reservations about Nvidia, pointing to the impact of the Ethereum merger on the company’s graphics cards used for mining. This skepticism stemmed from the belief that Nvidia had not fully transitioned to AI, virtual reality, and machine learning.
Weathering Storms and Riding High
Nvidia’s trajectory has been tumultuous, with periods of subdued growth interspersed with spikes in demand. The company navigated through economic uncertainties and geopolitical tensions in 2022, only to rebound strongly in the wake of the COVID-19 pandemic, driven by increased GPU sales for remote work, research, and gaming.
The AI Revolution
In the aftermath of OpenAI’s ChatGPT and the ensuing AI revolution, Nvidia found itself in a sweet spot, experiencing a surge in demand for its high-performance chips crucial for training AI models. The recent earnings report showcased strong performance, beating estimates by a wide margin and providing optimistic guidance for the upcoming quarter.
Impressive Returns
Investors who defied Cramer’s advice and invested $1,000 in Nvidia on that fateful day in September 2022 would now be sitting on 7.5 shares worth $5,894, marking a remarkable 490% return in just 17 months.
Market Cap Milestone
Last Friday, Nvidia almost touched a $2 trillion market cap, solidifying its position as a tech giant to reckon with. Analysts like Wedbush’s Daniel Ives lauded Nvidia’s visionary leadership and transformative impact, while skeptics warned of potential headwinds in the form of an AI bubble burst and heightened competition.
