Nvidia shares go down as chip shares slide. The fall cannot hide recent strength.

The time of dreams

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Nvidia

the stock has skyrocketed in 2021 and it is coming out with a bang. According to one company, it’s time to consider whether it’s time to replace

Netflix

in the FAANG.

Shares of Nvidia are down 1.8% to $ 303.93 on Tuesday morning, and are expected to end a four-day winning streak. Still, the title gained 138% in 2021, good for the fifth-best in the

S&P 500
at current prices.

Part of this is the overall strength of chip stocks.

Advanced micro-systems

(AMD) gained 67% in 2021, even after falling 0.9% on Tuesday morning, while the

IShares Semiconductor ETF
(SOXX) returned 48% despite falling 1% on Tuesday. The sector continues to benefit from strong demand for their products, while the supply remains tight.

But Nvidia has its own, company-specific reasons for being so strong. It touches just about every area of strength, from video games and Bitcoin to artificial intelligence and the metaverse, and looks set to continue to grow more and more. In fact, the folks at Fundstrat argue that Nvidia should really replace Netflix (NFLX) as N in FAANG.

“We believe that a day will potentially come when Nvidia will be seen as having much more in common with people like

Google
,

Apple
,

and

Amazon

[than] Netflix does, ”they write. “The latter is embroiled in the costly trench warfare style competition of digital content wars, where Nvidia essentially seems to be sliding over everything. Gone are the days when this knight at the forefront of Silicon Valley traded closely with cryptocurrency. ”

It may already be there. Nvidia’s big gain in 2021 gave it a market cap of $ 774 billion, nearly three times Netflix’s $ 272 billion market cap, meaning that no matter what, Nvidia is making an impact. bigger in the market every day than Netflix.

Write to Ben Levisohn at [email protected]

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