Nvidia Stock Price Hits $208 — And Wall Street Still Thinks It’s Cheap

When Nvidia closed at $208.27 on Friday afternoon, there was an odd quiet. On the surface, the figure didn’t seem particularly noteworthy, but when combined with the day’s volume of over 214 million shares, it became something the market had never seen before. The market capitalization is $5 trillion. For the first time since October, there was a record close. Nearly nobody rang a bell, and a tiny ceiling cracked open.

As you watch this play out, it seems like investors in Nvidia are no longer responding as they once did. No fireworks are present. On the trading floors, there is no giddy chatter. Just a quiet conviction, the kind that develops when people run out of adjectives and a stock has increased more than fourteenfold since the end of 2022. The sixteen-cent drop even in the after-hours move felt almost courteous.

On Friday, Nvidia wasn’t actually the catalyst. Of all the companies, Intel was the one that truly shocked people when it released its earnings late on Thursday. Shares of Intel increased by 24%, making it the best day for the stock since 1987. This is the kind of statistic that makes you pause and take another look. Qualcomm added 11%, while AMD increased 14%. Nvidia rode the wave even though it didn’t need to, and the entire semiconductor market saw a boost. It was dubbed sympathy buying by some analysts. It was dubbed rotation by others. Perhaps it was both.

The background, however, is what’s intriguing. A few weeks prior, the Iranian conflict was driving oil prices above $100 per barrel, and tech investors were taking their money out of large caps and putting it somewhere else. The ceasefire was then prolonged. Crude became softer. With a current April gain of about 15%, the Nasdaq is on course to have its best month since April 2020. Nvidia was seated in the front row when the atmosphere changed.

It’s difficult to ignore how Jensen Huang has developed into a sort of main character in this narrative. When he gestured during another keynote address about accelerated computing at GTC last month in San Jose, the audience reacted similarly to how concertgoers react to a returning main act. Google, Microsoft, Meta, Amazon, OpenAI, and Anthropic are all powered by the company’s GPUs. That basically means that one supplier’s silicon powers the entire AI economy. That concentration is both impressive and a little unsettling.

But competition is getting more intense. Ironically, one of Nvidia’s largest clients, Alphabet, has revealed that its own chips will be available to cloud users later this year. A one-year price target spread, according to CNN’s analyst data, ranges from $140 on the low end to $380 on the high end. There is no real consensus on what should happen next, as evidenced by the 240-point difference. The majority of the Street appears to be bullish but with cautious enthusiasm, as indicated by the median price of $267.50.

Additionally, there is the issue of valuation. For a business that is increasing revenue by 73% annually, a P/E ratio of 42.52 isn’t excessive, but it’s also not inexpensive. The shares were flagged by Barron’s coverage as potentially fully valued but fundamentally sound—a term analysts use when they are hesitant to commit. Next week’s hyperscaler earnings are the true test. The rally will continue to grow if cloud spending continues. The conversation changes overnight if it wobbles, even for a short while.