Owning ~.00001% of a company feels illusory to me, more difficult to intuit values. So would Nvidia share owners rather own all of Nvidia instead of all of Apple? I suspect not. The marginal buyer of nvidia is either:
* MEGA-FOMO
* Betting on the singularity
* Momentum trading
Besides growth, Nvidia also has much higher profit margins. In Q1 2024, Apple's margins were 42% gross, 26% net, versus Nvidia's 78% gross, 57% net. May or may not be sustainable, but for now Nvidia's basically printing money.
Out of curiosity, would your (or anyone else wanting to chime in) answer change if there was a qualifier that you had to buy today, and were not allowed to sell for 8 years?
>Out of curiosity, would your (or anyone else wanting to chime in) answer change if there was a qualifier that you had to buy today, and were not allowed to sell for 8 years?
Yes, even moreso. What is the bullish case for Apple? I love them to death, and am a total fanboy, but there is simply no arguement to be made for them growing beyond their current (correctly priced) value.
This raises for me the question of whether NV will still be ultra-valuable in 24 months. Well, Most Valuable Company globally.
I think it's overbought right now, but not by a lot. The singularity-oriented investment advice is to buy now, I guess -- if any company in the world is likely to be able to achieve some sort of 'liftoff' on chip design for AI, it's NV, and if they do get there successfully, then the current valuation is super cheap, and therefore the expected value of this + a downside where they "only" have the world's most valuable razorblades to sell for the next few years = BUY.
I can't help but think that Apple and Meta have a few more body blows to trade in here, and that we haven't really seen developed AI business models yet. The bear trade on this stock looks like: only one of the following needs to happen
1. TSMC + Apple get something better enough out the door at scale, inference benefits from Moore's law and starts moving to the edge, and voila - NV is no longer the sole or best $/token provider for training large models. In this world, they slip back into a competitive environment, and do GREAT, but probably not world's most valuable company great.
2. Meta has better AI research, achieves some sort of design liftoff, and, say, buys Intel to control it.
3. The world's inference and training needs do not continue to grow geometrically, the market over-reacts to a trailing off in demand for high end datacenter AI, and they lose their hefty growth premium on valuation.
I guess I net out at HOLD right now personally. This is not investment advice. But I am interested in other takes on their situation right now.
