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Nvidia’s market capitalization overtook Microsoft on Monday, making it the world’s second-largest company behind Apple.
Semiconductor companies and their partners are seeing strong demand for products that support artificial intelligence (AI).
Analysts suggested Nvidia stock could rise further given the strength of AI spending and seasonal tailwinds.
Nvidia (NVDA)’s market capitalization overtook Microsoft (MSFT) on Monday to become the world’s second-largest company behind Apple (AAPL).
Nvidia shares rose more than 2% on Monday, increasing the chipmaker’s market capitalization to $3.13 trillion, surpassing Microsoft’s $3.04 trillion. Nvidia partner Super Micro Computer (SMCI) reported strong GPU shipments driven by artificial intelligence (AI) demand, which helped boost both companies’ stock prices.
Nvidia and Microsoft have been competing with Apple for the top market capitalization spot in recent months. Nvidia briefly took the crown over Microsoft in June, but then Microsoft regained the crown and then Apple snatched it away.
NVIDIA stock could still rise on strength in AI spending, analysts say
Nvidia’s stock price has more than doubled since the beginning of the year as demand for AI chips soared. Analysts suggested that Nvidia stock could rise further given AI spending trends and strong seasonal tailwinds.
Semiconductor companies typically do better in the fourth quarter than in the third, and Nvidia “still looks to be in the lead,” analysts at Melius Research said Monday, adding, “We’re still in very good shape here.” he added.
Melius has a $165 price target for Nvidia, a 29% premium to Monday’s closing price of $127.72. This compares to an average price target of $152.52, according to Visible Alpha.
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