You might wish you had bought this chipmaker’s stock in the 1990s, but what was it like just five years ago?
Nvidia (NVDA -2.13%) is arguably one of the hottest stocks on the market, and has been for the past few years. The company’s position as a leading hardware provider in the artificial intelligence (AI) space has resulted in triple-digit revenue and profit growth every quarter.
The stock has risen nearly 750% since the beginning of last year, but the past few months have been a bit volatile. However, Nvidia continues to grow sales of high-end graphics processing units (GPUs) and is expected to remain the industry’s dominant supplier.
The company’s recent success and new position in the public consciousness is due almost exclusively to AI, with tech giants like Metaplatform and Alphabet spending lavish funds on building supercomputers and new AI data centers.
However, this was not an overnight success. The company has been providing high-speed processing power to the video game and graphics markets since the early 1990s. The company’s GPUs previously transformed video game graphics and helped build the industry into what it is today.
More recently, it experienced a mini-boom during the last major crypto bull market, as crypto miners scooped up the company’s GPUs to power machines mining proof-of-work coins. Still, none of these successes can match the past two years.
Long-term Nvidia shareholders have reason to be happy.
A $1,000 investment in Nvidia five years ago is worth more than $28,000 today (with dividends reinvested).
Data by YCharts.
I’m sure there are many people who wish they had bought Nvidia stock in 2019, or better yet, in 1999, when the company went public. But hindsight is 20/20, so there’s no need to beat yourself up for missing out. Unless you’re the luckiest investor in history, you’re going to miss out on some opportunities. More importantly, continue to look for good investments and build a diversified portfolio of solid companies with positions you plan to hold for at least five years. Nvidia could bring even greater returns to such a portfolio. This company is not done growing.
Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool’s board of directors. Suzanne Frey, an Alphabet executive, is a member of the Motley Fool’s board of directors. Johnny Rice has no position in any stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.
