Nvidia's path to $3 trillion: How it reached the milestone

Nvidia (NVDA) shares are trading slightly lower early Thursday after the tech giant's market cap briefly topped $3 trillion for the first time on Wednesday.

Yahoo Finance's Jared Blikre explains how Nvidia's stock has surged over the last few years.

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Stephanie Mikulich.

Video transcript

Nvidia.

Of course, after hitting that all time high, shares are pulling back.

Now that stock is down, just over 1% is coming off the back of that, uh, record breaking day for the stocks are passing that $3 trillion market cap.

Our very own Jared is here with the latest on NVIDIA.

Jared, what are we seeing here?

Is this profit taking?

Is it something else?

You know, uh, 1% is such a small percentage for NVIDIA.

I'm not gonna ascribe too much importance to it, but, you know, it's a relevant question.

Market cap is just under $3 trillion.

As you can see there, it's been compared to Apple switching places.

But I want to chart what's happened over the last five years because everybody's gearing up for this big stock split 10 to 1.

It's gonna take place tomorrow after the close, so it won't really You won't notice it in your account until Monday morning.

But here's NVIDIA over the last five years, and first you can see up 3200%.

That's just incredible.

But only in 2021 there was another stock split that was in July of that year, and, uh, it was announced in May, Affected in July.

From that time, the market kind of traded sideways, but then we had a bit of a rally.

It's hard to see on this chart right here, but that that right there was 85%.

But then something important here took over.

It was a bear market.

And this is NVIDIA peaking right before the end of 2020 2020 one.

This was a two thirds decline in a share price.

That's a lot of money.

We're talking trillions there and then from here all the way up, it's been nice to see this.

But what's really taken me by surprise over the last few years is how stable the for PE has been.

Just looking at the fundamentals.

It's ranged between 2060.

Right now it's at about 40.

But despite this incredible surge in price, we've seen the financials.

We've seen the fundamentals kind of confirm that picture.

Now each of these vertical slashes this these are the earnings date, and I just want to show you how important the catalyst of earnings has been.

In addition to the catalyst of, uh, stock splits.

And here you can see, we, uh We either get a rally or we get consolidation.

But important to point out that on the last, uh, on the last earnings report here, we got a big, big leg up.

How far does it go?

We don't know.

But at some point, at some point, there will be a pause, and then we'll just need that next catalyst, guys.