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Nvidia Rapidly Approaches Apple in Market Value, Surges Past $2 Trillion with Dominance in AI Chip Market

In a remarkable nine-month span, Nvidia has surged in market value, positioning itself as the world’s second-most-valuable company, trailing only behind Apple. The semiconductor giant’s market capitalization has soared from $1 trillion to over $2 trillion, currently standing at around $2.38 trillion. This surge places Nvidia approximately $230 billion behind Apple and positions it well ahead of Microsoft by about $645 billion.

Nvidia’s dominance in the high-end AI chip market, where it controls 80%, has been a key driver of its substantial growth, contributing to Wall Street reaching record highs this year. The company’s shares have experienced an impressive 95% increase, highlighting investors’ insatiable appetite for AI-related stocks and solidifying Nvidia as a significant component of the S&P 500 index.

Industry experts attribute the impressive rally to Nvidia’s robust fundamentals in its current business model and speculative support from long option buyers. Recently, this surge has propelled Nvidia to replace Tesla as the most traded stock by value on Wall Street.

While Apple contends with slowing iPhone sales, Nvidia’s ascent has reshaped the hierarchy of the most valuable US companies, surpassing Amazon, Alphabet, and Saudi Aramco. Despite its extraordinary performance, there are indications that Nvidia’s stock may be approaching a peak. Analysts suggest a median target price that implies a potential dip from the current closing price of $926 to $850 over the next 12 months. However, analysts also note that Nvidia remains comparatively affordable among ‘AI narrative’ stocks, and its future trajectory hinges on its ability to meet or exceed high expectations.

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