Nvidia is among the top 10 global companies by capitalization. Here’s how to buy shares, ETFs, and CFDs of the protagonist of the artificial intelligence boom.
How to buy Nvidia shares after the impressive 2023 performance?
Nvidia is among the top 10 big tech companies by capitalization and worth over $1 trillion. Founded in 1993 as a graphics card (CPU) manufacturer, it now dominates the artificial intelligence market. Its share value has soared 200% in 2023, driven by the rapidly growing trend of AI, and many investors may be interested in including the stock in their portfolio.
In this guide, we will see how to buy Nvidia shares.
Here is a summary of the general information on the Nvidia stock:
| TICKER | NVDA |
| ISIN | US67066G1040 |
| EXCHANGE | USA, Wall Street |
| INDEX | Nasdaq, S&P500 |
| CAPTALIZATION | $1.074 billion (updated 8/18/2023) |
| QUARTERLY | 08/23/2023 |
How to buy Nvidia shares
To invest in Nvidia shares, you need to have a securities account with your bank, or an online trading account with a broker. Here is a detailed guide on how to buy Nvidia stock.
- Choose trading platform: Before buying Nvidia shares, choose the platform of a bank or a reputable broker, verifying that they support the purchase of US shares. When choosing, it is important to consider whether there are extra transaction fees.
- Deposit funds in the account: in order to have the necessary liquidity to buy Nvidia shares, it is necessary to make a deposit in the trading account.
- Search and select shares: through the platform search engine it is possible to search for Nvidia shares. Before buying, it is always useful to plan the investment strategy in order to allocate the right budget with a view to correct portfolio diversification.
- Confirm order: after selecting the number of shares to buy, you can confirm your order via the trading platform. Always wait for your order to be executed and completed.
- Monitor Portfolio: Once the purchase is complete, it is useful to constantly monitor the news related to Nvidia stocks and their value over time.
Where to buy Nvidia shares
Nvidia shares can be purchased in three ways:
- through a SIM, securities firm;
- in a bank, with the help of a consultant;
- directly, with an online trading platform.
Nvidia is listed on the Nasdaq (ticker symbol: NVDA). To buy its shares, it is important to look among the best trading platforms for those that offer American stocks, especially the most actively traded ones, as they are ideal for online trading.
Buying Nvidia stock may not be affordable for everyone due to the high price of a single share (in excess of $430), limiting effective capital allocation for some investors.
Buying Nvidia shares via CFD
An interesting alternative to the direct purchase of Nvidia shares is the use of Contracts for Difference (CFD), leveraged financial instruments. Buying Nvidia shares through CFDs allows you to speculate on their price without physically owning them. You can go up (long position) or down (short position). Leverage requires only a margin of the total value, allowing for greater exposure. However, it should be noted that it magnifies both profits and losses based on position size
Buy Nvidia stock through a fund or ETF
Instead of buying Nvidia shares directly, it is possible to passively invest in the title, through the ETF funds that hold them. As one of the largest companies in the world by capitalization, Nvidia is included in indices such as the S&P 500 and the Nasdaq Composite. The ETFs that track these indices hold Nvidia shares. Some ETFs hold a significant amount, such as the VanEck Semiconductor ETF with a weight of 19.5%.
- Nvidia stocks owned by ETF funds
- Source: MotleyFool
Why buy Nvidia stock
Investing in Nvidia stock could prove to be a very promising choice, especially considering the rally of nearly 200% in the first half of 2023. This increase was mainly driven by the growth in artificial intelligence, which contributed to overcoming the challenges of the personal computer market. Additionally, the outlook is attractive: Nvidia expects strong revenue and earnings growth in fiscal 2024, with revenue increase of 59% and adjusted EPS projected at $7.78, double that of $3.34 from the previous year. These factors combined could make it an attractive investment opportunity.
- Nvidia EPS
- Source: MotleyFool
Nvidia Stock Features
Nvidia is an American company leader in production of powerful graphics chips and artificial intelligence software. The company is famous for creating the iconic GeForce video cards.
History of Nvidia
Founded in 1993 by Jen-Hsun "Jensen" Huang, Curtis Priem, and Chris Malachowsky, Nvidia Corporation is famous for the design of graphics processing units (GPUs). Based on the belief that dedicated GPUs were crucial to graphics advancement, Nvidia released the GeForce card in 1999, featuring advanced 3D graphics and lighting techniques. While initially dominating the gaming GPU space, Nvidia has branched out into high-performance computing (HPC) and artificial intelligence (AI), retrofitting gaming processors for a variety of computational tasks. Among its milestones, Nvidia introduced CUDA in 2006, a language that allowed direct programming of GPUs. The company acquired Mellanox Technologies in 2019 to strengthen its intelligent data routing and processing capability. Although the attempt to acquire Arm Holdings in 2020 failed, Nvidia’s history is marked by technological innovation and strategic expansion beyond just gaming GPUs.
Nvidia quarterly earnings
Second quarter financial results released August 23, 2023:
- Earnings: EPS of $2.07, ahead of analyst estimates ($2.07) and up 306% year over year.
- Revenue: $11.1 billion, slightly better than forecast ($11.1 billion).
- Nvidia’s valuation: about 220 times estimated earnings.
- Quarterly dividend: $0.04 per share.
Nvidia doesn’t offer a high dividend, but it is active in returning money to investors through share repurchases. In 2023, it returned $10.4 billion to investors by dividing it and repurchasing over $10 billion in stock. Even as cash returns exceed free cash flow, the company maintains a solid balance sheet, with $13.3 billion in cash and less than $11 billion in debt as of early 2024.
Nvidia’s prospects
Morgan Stanley has an optimistic view on Nvidia, saying the company is among their "Top Pick" due to growing spending on AI and a supply-demand imbalance expected to last for several quarters.
UBS ’s Timothy Arcuri highlighted Nvidia’s crucial role in the technology landscape, calling it a "kingmaker" for broad interest in AI software and specialized cloud models. Both investment banks have raised their price targets, viewing the recent decline as an opportunity for entry.
Should you buy Nvidia shares?
In summary, Nvidia’s future looks promising thanks to the expansion of artificial intelligence and IoT. Further investment potential lies in the growing automotive industry, worth $400 billion a year.
The solid financial situation and the positive trend increase the confidence of shareholders and investors in the long-term growth potential. With its continued commitment to innovation and diversification, Nvidia remains well positioned to maintain technology leadership.
Original article published on Money.it Italy 2023-08-24 08:15:00. Original title: Come comprare azioni Nvidia
