In the previous tax season, the IRS issued nearly 95 million refunds totaling over $266 billion. As of May 12, 2023, the average tax refund was $2,812. If you had invested this amount in Nvidia stock a year ago, you might be curious about the current value of your investment.
NVIDIA Corp. (NASDAQ:NVDA) has experienced an extraordinary over the past five years, particularly since the beginning of 2024. The stock has surged 186% since May 2023, driven by strong demand for AI chips, and its market value jumped from $1 trillion to $2.7 trillion.
On May 30, 2024, the company’s share price stood at an impressive $1,150. If you invested your tax refund of $2,812 in Nvidia stock a year ago when the share price was around $290, you could have bought roughly 9.7 shares.
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Fast-forward to today. Those 9.7 shares would now be worth about $11,155, meaning your initial $2,812 investment would have grown by $8,343 in just one year. That’s an impressive return of nearly 300%.
Nvidia’s Extraordinary Growth
Last fiscal year, the chipmaker generated nearly $61 billion in revenue, a significant increase from around $27 billion the previous year. Even more impressive is the company’s most recent quarterly report, which showed revenue of $26 billion — a tremendous 262% increase compared to the same quarter last year.
It’s uncommon for a company as large as Nvidia to grow so quickly. However, Nvidia has defied the odds and its incredible growth has pushed its market value to about $2.7 trillion, more than Amazon’s $1.84 trillion and Tesla’s $563.84 billion combined.
This massive growth demonstrates that Nvidia stands out in business, providing significant opportunities for those who invested early.
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Now, Nvidia’s market capitalization of $2.7 trillion is just 4% shy of Apple’s $2.9 trillion valuation and 11% of Microsoft’s $3.2 trillion, placing Nvidia on the verge of becoming the world’s most valuable company.
Analysts Suggest Caution
Despite all the positive signs for Nvidia, analysts suggest that investors should not put all their money into just one stock. They advise diversifying investments by spreading money across various stocks instead of betting everything on a single company.
“When the majority of AI workloads in the cloud move over from training to inference, Nvidia’s dominant market share position will be tested. Most use cases in inference do not require the depth/amount of computing provided by Nvidia’s top GPUs,” Lucas Keh, an analyst at Third Bridge, explained.
Is Nvidia’s extreme growth ending, or is it just the start? Only time will tell. That doesn’t mean you shouldn’t save or even invest your tax return. From Tokyo To New York, stock markets are seeing unprecedented growth, and you may be leaving money on the table by not investing.
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This article If You Invested Last Year’s $2,812 Average Tax Refund In Nvidia Stock, Here’s How Much It Would Be Worth Today originally appeared on Benzinga.com
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