NVIDIA Stock Split: Will NVIDIA Stock Split in 2023? (2024)

The Chances of a split in NVDA stock have risen significantly on account of accelerated revenue and price forecasts. Revenues are predicted to triple in the next quarter and sustain at a fairly high level over the next few years. As a consequence, some analyst forecasts have breached $1000 and many are at more than $600. These are levels at which NVDA becomes a prime candidate for a stock split. Read our detailed analysis along with the latest analyst summary.

NVDA Stock Performance

• Last 1 Month: +7.4%
• Last 6 Months:+18.1%
• Last 12 Months: +166.2%

NVIDIA Latest News

• Nvidia wants to set up a base in Vietnam to help develop the country’s semiconductor industry and attract talent. This was announced by the Vietnamese government after a meeting between Nvidia CEO Jensen Huang and Vietnamese Prime Minister Pham Minh Chinh. The base could play a significant role in boosting Vietnam’s tech sector and making it a more attractive destination for foreign investment.
• The US government, represented by Secretary of Commerce Gina Raimondo, is in discussions with Nvidia about the sale of its AI chips to China. This is a complex issue with significant implications for both countries, involving national security concerns, technological advancement, and economic interests. The US government has prohibited NVIDIA from shipping the AI chips to China.
• CCM Investment Advisers LLC reduced its stake in NVIDIA by 22.3% during the second quarter of 2023. According to the company in its most recent Form 13F filing with the US SEC, they sold 13,599 shares, leaving them with 47,304 shares of NVIDIA stock. NVIDIA remains CCM’s 6th largest holding, making up 2.7% of their portfolio.

Will NVIDIA Stock Split in 2023?

Net Rating = Yes% – No%

• August 30th: +44.5%
• September 1st: +61.3%
• October 13th: +65.3%
• November 30th: +51.0%
• December 1st: +49.0%
• December 14th:+43.0%

While it’s challenging to predict with certainty, the rising stock price and the company’s recent financial performance make the possibility of a stock split in 2023 likely. Major Takeaways in favor and against a split

NVIDIA Q3 Earnings

NVIDIA delivered a stellar performance in its third quarter of 2023, with revenue surging 206% year over year to $18.12 billion. This remarkable growth was fueled by a 279% increase in data center revenue, reaching $14.51 billion. The gaming segment also contributed significantly, with revenue up 81% to $2.86 billion, propelled by the popularity of NVIDIA’s GeForce RTX 30-series graphics cards.

NVIDIA’s financial performance was equally impressive, with net income soaring to $9.24 billion, or $3.71 per share, compared to $680 million, or 27 cents per share, in the same quarter a year ago. NVIDIA also reported strong operational efficiency, with gross margin expanding to 66.2% from 57.6% a year ago, and operating margin climbing to 38.0% from 27.5%.

Here are some of the highlights from NVIDIA’s Q3 earnings:

• Revenue of $18.12 billion, up 206% year over year
• Data center revenue of $9.24 billion, up 279% year over year
• Gaming revenue of $2.86 billion, up 81% year over year
• Net income of $9.24 billion, or $3.71 per share, up from $680 million, or 27 cents per share, in the same quarter a year ago
• Gross margin of 66.2%, up from 57.6% in the same quarter a year ago
• Operating margin of 38.0%, up from 27.5% in the same quarter a year ago

NVIDIA Guidance for Q4 2023

Nvidia has projected revenue of $20 billion for the fiscal fourth quarter, indicating a staggering growth rate of nearly 231%. Their EPS guidance for the same period stands at $3.34 for fiscal 2023. Introducing the GH200 GPU, Nvidia has enhanced its capabilities, boasting more memory than the existing H100 and incorporating an extra Arm processor onboard.

In addition, Nvidia recently disclosed a significant deal with Iris Energy based in Australia. Iris Energy, a proprietor of bitcoin mining data centers, is set to acquire 248 H100s for a total of $10 million, valuing each unit at approximately $40,000.

NVIDIA Stock Split Prediction

NVIDIA has had stock splits five times in the past and the last split took place in 2021. The NVIDIA stock back then was trading around $800. It must be remembered that the last NVIDIA stock split came after 14 years of its previous split. Currently NVIDIA stock is above $500 and from the point of investors, NVIDIA is expensive, and in order to have more investors holding NVIDIA stock, it needs to be cheaper, therefore a stock split or a market crash are the only options for the NVIDIA stock to become cheaper.

As for the NVIDIA stock split prediction, the company may not be in a rush to split the stock place as the market has been highly volatile lately. NVIDIA has managed to break above $500 a couple of times but has failed to hold above this level. Therefore, the company may wait until there is some sort of stability in the market before exercising a stock split.

Nvidia Stock Split Date

There is no specific date for the next NVIDIA stock split. However, many analysts predict that the NVIDIA stock split could happen in 2024.

Will NVIDIA Stock Split? Arguments In favor of a split

1. Stock Price: Analysts expect NVIDIA stock to touch $1000 in the coming months. If the stock price becomes too high and potentially inaccessible for many investors, the management might consider a split to make the stock more attractive to retail investors. A price between $150 to $300 has historically been seen as comfortable for many big tech companies, indicating that if the stock surpasses this range significantly, a split becomes more probable.
2. Company Performance: NVIDIA’s recent performance, as reflected in its Q2 earnings summary, shows strong growth in revenues and earnings, suggesting that the company is on a solid footing. This might provide management with more confidence in considering a stock split.

Will NVIDIA Stock Split? Arguments against a Split

1. Historic Track record: NVIDIA has split its stock on five occasions since its listing on the Nasdaq. The most recent split was in 2021 when the stock was trading at around $800. Given that the company had not split its stock for nearly 14 years before the 2021 split, this suggests NVIDIA may not necessarily be in a hurry to split its stock frequently.

2. Market Conditions: The current market conditions are quite uncertain given the stance of the Federal Reserve and hence liquidity conditions may not favor improved stock performance after the split

3. Industry Trends: NVIDIA split the stock in 2021 which is also when numerous companies announced stock splits. That is not the case now and it is unlikely NVIDIA will buck the trend.

4. Emerging Competition – Competitors like AMD and Intel are ramping up their AI capabilities to challenge Nvidia’s position. Even major tech companies such as Google, Microsoft, and Amazon are developing their own AI chips, potentially reducing their reliance on Nvidia in the future.

5. Emerging Geopolitical Risks: The United States has banned the export of numerous NVIDIA products to China and Russia. China is perhaps one of the world’s largest markets. Recently, The Biden administration included some Middle Eastern countries as well. These pose a risk to revenues and also increase the probability of competitors gaining on NVDA.

In sum, NVIDIA is likely to announce a split if economic conditions improve this year. Most other conditions are favorable for a split at the moment.

What is Stock Split and Is it Good or Bad for the Market?

Stock splits are a way to make more shares of a company’s stock without changing the company’s overall value. Even though the total value of the company stays the same, the price of each individual share becomes lower after a split.

Companies might do stock splits to attract investors who don’t want to spend a lot on a single share. By making the price per share lower, more people might be interested in buying.

During a stock split, the company creates more shares and gives them to existing shareholders. This can make it easier to buy and sell the stock because there are more shares available.

However, doing too many stock splits might not be a good idea. While it can make the stock seem more affordable, if a company does a lot of splits, it could create confusion or make people wonder if something’s wrong with the company’s value.

Additionally, as we know stock splits often happen when a stock’s price has gone up a lot. This makes the stock seem pricey to some investors. So, the split makes the stock look cheaper, which attracts more investors who want to buy.

However, this can also catch the attention of people who bet that the stock’s price will drop, called short sellers. They might see the split as a chance to bet against the stock and make money if the price falls. Sometimes, this can cause the stock’s price to go down a bit after the split.

Therefore, the stock split could be both good and bad for the market.

Will there be an NVIDIA Stock Split?

The NVIDIA stock price has been surging and analysts expect the stock to touch $1000 in the coming months. The higher the price of the stock lesser will be buyers and many buyers may not be able to afford to buy the stock at a higher price.

Therefore, in the event of NVIDIA stock becoming inaccessible to the majority of the buyers, the company’s management could possibly resort to splitting the stock. This could attract more buyers.

However, there has been no such announcement by NVIDIA management regarding the stock split. But the surge in the stock price of NVIDIA is a possible signal that the management could consider a stock split in the future.

When will there be an NVIDIA stock split next?

In theory, it is difficult to predict the next stock split. However, looking at past data, there are some scenarios under which a stock split by NVDA makes sense

• Stock Price > $300
• Solid Quarterly Results

NVIDIA Stock Split: Nvidia Stock Split History

Nvidia Corporation has a history of stock splits. Nvidia Corporation has announced stock splits on five different occasions in its trading history on Nasdaq. The stock split history is listed below for reference: –

NVIDIA Stock Split: Inference from past Splits

• A stock split is considered a good sign for the company. It has been observed that stocks get a short-term push just after the stock split. But that is not the case with Nvidia. At the time of the first split, the stock was trading around $185, and post-split it began trading at around $85 and it remained at the same level till the next split i.e. 17.9.2001. The stock did not reach this level again for the next 10 years.

• After a series of four stock splits in seven years between 2000-2007, NVIDIA announced the next stock split only in 2021. But Nvidia was not alone, Google, Apple, Amazon, Microsoft, and other big companies stayed silent for nearly two decades from 2000 to 2020. For example, Before the recently announced stock split, Amazon Inc last declared a stock split in 1999. Microsoft last announced a split in 2003. Similarly, Ford Motors last announced a split in 1994.

NVIDIA Stock Split: Last Stock Split in July 2021

• Nvidia announced a 4:1 stock split on May 26th, 2021 along with its first-quarter results. The stock price was trading around $800 and then it came back to around $200. The primary reason for announcing the stock split was to make it more accessible to small retail investors. Although various brokers do allow for fractional share purchases, a retail investor is more comfortable buying complete shares. Also, a price range between $150 to $300 is seen as comfortable (Looking at NVDA, Amazon, and Alphabet Stock Splits).

• NVDA’s share price closed at $186.12 on 20.7.2021, and in the last one-year stock has given a 93% return. The share price touched an all-time high of $333.76 on 19th November 2021. So in less than a four-month period, the share price almost doubled, but the rally could not be sustained due to uncertainties in the global market and various other factors like inflation fears in the US and Russia-Ukraine war.

• The split in 2021 was different from other splits as this was on the backdrop of very strong quarter results. First-quarter revenue in 2021 was $5.66 billion, greater than the $5.3 billion expected and it rose 84% YoY. Earnings per share also surged 106% Gaming segment revenue increased 106% while data center revenue surged 79% YoY. So the company had shown very strong performance in the last quarter and even in the year prior to announcing the split in 2021 and that is the main reason why the stock shot up more than 180% in less than four months post announcing the split.

• Share price at the time of all splits barring the most recent one was in the range of $50-100 and post-split it hovered around $30-50. The same was not the case in 2021, thanks to an extraordinary run-up of the stock and the share price was around $780. It clearly signals that the split in 2021 was meant to make it more accessible to investors while all the previous ones were carried out with some other intention, maybe to dilute the shares outstanding.

NVIDIA Stock Latest News

• Tech giant Nvidia is reportedly in advanced talks with Malaysian power-to-property conglomerate YTL Corp (YTL) on a data center deal. This potential partnership could have significant implications for the Southeast Asian cloud computing landscape. The deal will reportedly focus on collaborating on cloud infrastructure,likely to be anchored at YTL’s data center complex in Johor Bahru,bordering Singapore.
• Nvidia CEO Jensen Huang expressed confidence despite the recent setback of a US legislative measure aimed at expediting semiconductor projects. Huang believes that the company’s diversified manufacturing strategy mitigates any potential risks arising from the stalled bill.
• Nvidia’s CEO Jensen Huang has expressed confidence in the safety of artificial intelligence, despite recent concerns raised by the OpenAI chat bot. He believes that AI developers are capable of managing the risks associated with AI and that the benefits of AI far outweigh the risks.
• Nvidia’s CEO, Jensen Huang, disclosed the company’s efforts to create chips aligned with stricter regulations on chip exports to China. This move comes in response to recent U.S. government limitations on high-end chip sales to China, citing security reasons. Approximately $5 billion worth of Nvidia chips face uncertainty due to these export constraints, prompting expectations of a significant decline in short-term sales to China.
• Meta and Microsoft are buying AMD’s new AI chip to compete with Nvidia and reduce reliance on them. This could lead to a more diverse and competitive AI chip market.

NVIDIA Analysts Price Targets

Check out: Palantir Stock Forecast

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