You may wish you’d bought the chipmaker’s shares back in the 1990s, but what about just five years ago?
Nvidia (NVDA -2.13%) is undoubtedly one of the hottest stocks in the market and has been for a few years now. Its position as a provider of key hardware for the artificial intelligence (AI) space has fueled quarter after quarter of triple-digit growth for its sales and earnings.
While the stock has gained nearly 750% since the beginning of last year, it has charted a somewhat rocky course over the past few months. But Nvidia looks on track to keep growing sales of its high-end graphics processing units (GPUs) and remain the industry’s dominant supplier.
The company’s recent successes and its new place in the popular consciousness come almost exclusively from AI, where tech giants like Meta Platforms and Alphabet have been spending lavishly to build supercomputers and new AI data centers.
This isn’t an overnight success story, though. The company has been providing rapid processing power to the video gaming and graphics markets since the early 1990s. Its GPUs previously transformed video game graphics and helped build that industry into what it is today.
More recently, the company saw a mini-boom during the last major crypto bull market as cryptocurrency miners scooped up its GPUs to power the machines that mine proof-of-work coins. Still, none of those successes can really compare to the last two years.
Longer-term shareholders of Nvidia have reason to be happy
A $1,000 investment made in Nvidia five years ago would be worth more than $28,000 today (with dividends reinvested).
Data by YCharts.
I’m sure many people wish they bought shares of Nvidia back in 2019, or better yet, back in 1999 when the company went public. But hindsight is 20/20, and there’s no need to beat yourself up for missing out. Unless you’re the luckiest investor in history, you’re going to miss some opportunities. What’s more important is continuing to look for great investments, and building a diverse portfolio of solid companies with positions you intend to hold for at least five years. Nvidia could still be a very profitable addition to such a portfolio — this company is not done growing.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.