6. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 179
10-year Revenue CAGR: 34%
NVIDIA Corporation (NASDAQ:NVDA) is a tale of innovation, resilience, and strategic evolution which is why it is one of the best beginner stocks to buy. Founded in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem in a meeting at Denny’s diner in San Jose, the company started with a vision to revolutionize computing through graphics-based processing. Despite early struggles, including the failure of its first graphics accelerator and a near brush with bankruptcy, the company persevered. As of 2024, it is the most dominant player in the GPU market.
The company’s strategic decisions to diversify into areas like AI, data centers, and autonomous vehicles have paid off immensely. Nvidia’s CUDA software platform, introduced in the mid-2000s, played a pivotal role in establishing the company as a leader in high-performance computing and AI.
Despite some setbacks, NVIDIA’s (NASDAQ:NVDA) growth trajectory has been remarkable, especially after the Gen AI trend that started with the launch of ChatGPT. The company reached a valuation of over $3 trillion in 2024 and briefly became the most valuable publicly traded company.
On August 22, The Fly reported that Citi maintained a Buy rating on NVIDIA (NASDAQ:NVDA) with a price target of $150 in anticipation of the company’s earnings report for the July quarter, scheduled for August 28. Citi analysts believe that the company could exceed Wall Street’s revenue projections by about $1 billion, though this would be less than the $2 billion revenue beat it achieved in the previous four quarters. This lower-than-expected beat is attributed to concerns about supply chain issues and delays related to the company’s Blackwell chip series.
Citi expects that after the earnings report, analysts will likely revise their revenue forecasts upward for NVIDIA’s (NASDAQ:NVDA) upcoming quarters. The firm also anticipates that the company will address Blackwell-related concerns, providing a positive outlook for 2025. This reassurance is expected to boost investor confidence and potentially push the company’s stock to reach a new 52-week high.
As of the second quarter, 179 hedge funds held NVIDIA (NASDAQ:NVDA) shares worth $53.67 billion. Fisher Asset Management is the company’s most significant shareholder with 93.437 million shares worth $11.54 billion, as of June 30.
Aoris International Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q2 2024 investor letter:
“If Information Technology was the dominant sector for the quarter, NVIDIA Corporation (NASDAQ:NVDA), which is the largest supplier of microprocessors used for generative AI applications, was the dominant company. NVIDIA’s share price rose by a third in the quarter and has increased by 255% so far this year. Since the beginning of 2023, its market value has risen by 8.3x, or $4.3 trillion, making NVIDIA the third largest company in the world by this measure.
As a result of the unusually strong stock price performance from NVIDIA and a few other large companies, equity markets have become increasingly concentrated. You can see this in the chart below, which shows that on 30 June, 27% of the market value of the 500 largest US companies was attributable to just five companies, more than twice the average of the last 20 years.
The composition of the Aoris International Fund will always be very different to that of the broader equity market. There will be periods, such as the most recent quarter, where this contributes to our performance lagging that of our benchmark. When it comes to NVIDIA and other AI-centric companies, rapid growth is exciting, but it makes it difficult for us to judge what is normal. Our preference is to own established leading companies where we can make a more confident, evidence-based judgement about their growth and profitability.”
