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华尔街日报Insights Into NVIDIA's Performance Versus Peers In Semiconductors & Semiconductor Equipment Sector
Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating NVIDIA (NASDAQ:NVDA) in comparison to its major competitors within the Semiconductors & Semiconductor Equipment industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in the industry.
NVIDIA Background
Nvidia is a leading developer of graphics processing units. Traditionally, GPUs were used to enhance the experience on computing platforms, most notably in gaming applications on PCs. GPU use cases have since emerged as important semiconductors used in artificial intelligence to run large language models. Nvidia not only offers AI GPUs, but also a software platform, Cuda, used for AI model development and training. Nvidia is also expanding its data center networking solutions, helping to tie GPUs together to handle complex workloads.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| NVIDIA Corp | 46.56 | 38.46 | 24.71 | 29.14% | $38.75 | $41.85 | 62.49% |
| Taiwan Semiconductor Manufacturing Co Ltd | 33.31 | 10.48 | 14.42 | 9.44% | $691.11 | $588.54 | 30.31% |
| Broadcom Inc | 72 | 20.03 | 26.09 | 11.02% | $9.86 | $12.25 | 28.18% |
| Advanced Micro Devices Inc | 115.75 | 5.92 | 11.27 | 2.06% | $2.11 | $4.78 | 35.59% |
| Micron Technology Inc | 29.67 | 5.97 | 8.33 | 9.28% | $8.35 | $7.65 | 56.65% |
| Qualcomm Inc | 35.19 | 8.90 | 4.40 | -12.88% | $3.51 | $6.24 | 10.03% |
| Intel Corp | 656.17 | 1.77 | 3.25 | 3.98% | $7.85 | $5.22 | 2.78% |
| Texas Instruments Inc | 32.27 | 9.68 | 9.39 | 8.21% | $2.24 | $2.72 | 14.24% |
| Analog Devices Inc | 60.81 | 4.02 | 12.50 | 2.32% | $1.47 | $1.94 | 25.91% |
| ARM Holdings PLC | 148.86 | 16.63 | 28.05 | 3.3% | $0.22 | $1.11 | 34.48% |
| Marvell Technology Inc | 31.77 | 5.44 | 10.06 | 13.84% | $2.58 | $1.07 | 36.83% |
| NXP Semiconductors NV | 27.67 | 5.61 | 4.74 | 6.43% | $1.11 | $1.79 | -2.37% |
| Monolithic Power Systems Inc | 24.50 | 12.82 | 17.28 | 5.12% | $0.21 | $0.41 | 18.88% |
| ASE Technology Holding Co Ltd | 34.28 | 3.66 | 1.86 | 3.56% | $32.4 | $28.88 | 5.29% |
| First Solar Inc | 20.87 | 3.24 | 5.79 | 5.19% | $0.61 | $0.61 | 79.67% |
| ON Semiconductor Corp | 80.40 | 2.99 | 3.97 | 3.22% | $0.44 | $0.59 | -11.98% |
| STMicroelectronics NV | 47.26 | 1.36 | 2.16 | 1.33% | $0.31 | $1.06 | -1.97% |
| Credo Technology Group Holding Ltd | 120.90 | 19.70 | 33.64 | 7.99% | $0.09 | $0.18 | 272.08% |
| United Microelectronics Corp | 14.41 | 1.70 | 2.55 | 4.29% | $30.07 | $17.62 | -2.25% |
| Tower Semiconductor Ltd | 68.95 | 4.70 | 8.93 | 1.9% | $0.13 | $0.09 | 6.79% |
| Lattice Semiconductor Corp | 402.90 | 15.60 | 22.50 | 0.4% | $0.01 | $0.09 | 4.92% |
| Rambus Inc | 46.43 | 8.15 | 15.63 | 3.84% | $0.08 | $0.14 | 22.68% |
| Average | 100.21 | 8.02 | 11.75 | 4.47% | $37.85 | $32.52 | 31.75% |
Through a meticulous analysis of NVIDIA, we can observe the following trends:
A Price to Earnings ratio of 46.56 significantly below the industry average by 0.46x suggests undervaluation. This can make the stock appealing for those seeking growth.
With a Price to Book ratio of 38.46, which is 4.8x the industry average, NVIDIA might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
The stock's relatively high Price to Sales ratio of 24.71, surpassing the industry average by 2.1x, may indicate an aspect of overvaluation in terms of sales performance.
With a Return on Equity (ROE) of 29.14% that is 24.67% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
The company exhibits higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $38.75 Billion, which is 1.02x above the industry average, implying stronger profitability and robust cash flow generation.
The gross profit of $41.85 Billion is 1.29x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
The company is experiencing remarkable revenue growth, with a rate of 62.49%, outperforming the industry average of 31.75%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a measure that indicates the level of debt a company has taken on relative to the value of its assets net of liabilities.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
By considering the Debt-to-Equity ratio, NVIDIA can be compared to its top 4 peers, leading to the following observations:
In terms of the debt-to-equity ratio, NVIDIA has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.
This implies that the company relies less on debt financing and has a more favorable balance between debt and equity with a lower debt-to-equity ratio of 0.09.
Key Takeaways
For NVIDIA, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB and PS ratios suggest strong market sentiment and revenue multiples. The high ROE, EBITDA, gross profit, and revenue growth highlight robust financial performance and growth prospects within the industry. Comparing these metrics with peers in the Semiconductors & Semiconductor Equipment sector reveals NVIDIA's competitive positioning and potential for future growth.
This article was generated by Benzinga's automated content engine and reviewed by an editor.