Market value to reach $6.75 billion? Evercore ISI: NVIDIA's weight in the S&P 500 "expected" to increase to 15%
NVIDIA is expected to become a 15% weight stock in the S&P 500 index, with a market value of $67.5 billion, exceeding Japan's gross domestic product. According to a report released by Evercore ISI, NVIDIA is a technological ecosystem player with the opportunity to lead the era of parallel processing. Historical data shows that ecosystem participants tend to increase their weight in the S&P 500 index, and NVIDIA has the potential to become a heavyweight stock. The company's current weight is comparable to Apple's, at around 6.6%, while Microsoft's weight is around 7%. Given its development trajectory and dominant position in relevant fields, it is not impossible for NVIDIA to become a 15% weight stock in the S&P 500 index
According to the Zhitong Finance and Economics APP, Evercore ISI released a report stating that in addition to being a manufacturer of artificial intelligence chips, NVIDIA (NVDA.US) is also a player in the technology ecosystem game, thus having the potential to account for 15% of the S&P 500 Index.
Julian Emanuel, Senior Managing Director of Evercore ISI, stated in a report last Sunday that NVIDIA became the third company in history to surpass a market value of $3 trillion last week, calling it "a generational opportunity to lead the 'parallel processing' era."
Mark Lipacis, responsible for semiconductor and capital equipment company research at Evercore ISI, mentioned that historically, NVIDIA could become a stock with a weight of 10%-15% in the S&P 500 Index. Currently, the company's weight is comparable to Apple (AAPL.US) at around 6.6%, while Microsoft (MSFT.US) is at approximately 7%.
In another report on Friday, Lipacis stated, "We observe that in each successive computing era, ecosystem participants' weights in the S&P 500 Index increase." In 2007, during the PC era, Microsoft accounted for 3% of the S&P 500 Index, and in 2015, Apple accounted for 4%. Going further back, Digital Equipment Corporation (DEC) held 1% during the mini-computer era, and Nokia (NOK.US) was the flagship company of the feature phone era, accounting for 2% of the S&P 500 Index.
Lipacis mentioned, "Based on this trajectory of development, and NVIDIA's dominant position in the field of parallel processing chips + software + hardware + networking, we believe that it is not impossible for the company to eventually become a stock with a weight of 15% in the S&P 500 Index."
Based on current market value calculations, NVIDIA's market value would reach $675 billion to achieve a 15% weight, surpassing Japan's domestic production value of $423 billion, ranking third in the world.
After NVIDIA's stock split on Monday, the stock rose by 0.62% to $122.53 as of the time of writing. The largest ETF funds with NVIDIA weight include (USD.US), (SHOC.US), and (WUGI.US).
