Tech Showdown: Nvidia Is Approaching Apple in Market Value

AAPL shares have experienced a correction of nearly 20% from their recent high, while NVDA stock continues to surge, reaching new highs and surpassing $900 early on Thursday for the sixth consecutive day of gains.

Nvidia vs Apple

Nvidia, the artificial intelligence chip maker, recently surpassed Saudi Aramco to become the world's third most valuable company, and now it has its sights set on Apple.

Although there is still a significant gap in terms of market capitalization, approximately $400 billion, it is the closest the two companies have ever been. At the beginning of the year, Apple was worth $1.33 trillion more than Nvidia, and a year ago, the gap was $1.83 trillion. Ten years ago, Apple was 47 times larger than Nvidia. The performance divergence between the two stocks has been particularly pronounced in 2024, with Apple falling 12% and Nvidia increasing by 79% so far this year.

Apple's shares faced additional pressure earlier in the week after a report suggested a 24% decline in iPhone sales in China during the first six weeks of the year.

On the other hand, Nvidia's momentum remains strong, with shares climbing for five consecutive days and experiencing a 14% increase during that period. In contrast, Apple has declined for six consecutive days, with a decrease of over 7% during that time.

Is Nvidia Overvalued?

While some may question whether Nvidia is entering bubble territory, analysts believe that the company's valuation is justified due to its current earnings and future earnings potential.

From a technical perspective, Nvidia recently broke through the $807 level, indicating a momentum trade that has already yielded about 15% in profit.

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Will be taking profits at around 875 when the market opens today.