4 Stocks Riding the Wave of Nvidia’s Bullish Momentum

In the wake of Nvidia Corporation NASDAQ:NVDA After the shocking earnings report, the US stock market soared to new heights, buoyed by the tech titan’s resounding success. With stocks basking in record territory, the S&P 500 and Dow Jones Industrial Average have risen to unprecedented heights following Nvidia’s breakout performance.

Nvidia reached a monumental milestone on Friday, surpassing the coveted $2 trillion valuation for the first time in its history. This feat firmly cemented Nvidia’s position as the third largest company in the United States by market capitalization, behind only giants such as Apple and Microsoft Corporation. NASDAQ:MSFT.

As the stock hit a high of $823.94 on Friday, the hype around Nvidia intensified, prompting what can only be described as artificial intelligence mania. Year-to-date, Nvidia has seen an astonishing surge of nearly 60%, up a staggering 238% from the previous year, underscoring the company’s explosive growth trajectory.

Amid this frenzy, it becomes clear that Nvidia’s success has repercussions far beyond its corporate boundaries. Many other stocks have found themselves in the wake of Nvidia’s meteoric rise, leveraging unique partnerships or substantially benefiting from the tech giant’s unprecedented growth trajectory.

Four stocks benefiting from Nvidia’s explosive growth

Taiwan semiconductor manufacturing New York Stock Exchange: TSM

Taiwan Semiconductor Manufacturing Company is the world’s leading semiconductor foundry, specializing in producing semiconductors for various companies according to their specifications. Founded as a semiconductor foundry, TSM continues to dominate this niche market.

Its customer base includes major technology companies such as Advanced Micro Devices Inc. NASDAQ:AMD, The Apple company. NASDAQ:AAPL, NvidiaAND Broadcom Inc. NASDAQ: AVGO. Semiconductor manufacturers with their production facilities, such as e.g Intel Society NASDAQ: INTC AND Texas Instruments Inc. NASDAQ:TXNleverage TSM’s experience to some extent.

The company, which makes chips for Nvidia, has seen its shares rise an impressive 24.55% year to date and nearly 50% from a year earlier. Despite these impressive earnings, it still trades at a modest P/E of 25x and offers a dividend yield of 1.18%. TSM expects earnings growth of 23.5% and a Moderate Buy rating based on five analyst ratings.

Amazon.com NASDAQ:AMZN

AWS and Nvidia have worked together for more than a decade to provide customers with robust, affordable, and adaptable GPU-based solutions. These collaborative efforts range from cloud services with Nvidia GPU-powered Amazon EC2 instances to edge computing solutions like AWS IoT Greengrass integrated with Nvidia Jetson Nano modules.

Globally, customers leverage these solutions for various applications, including machine learning, virtual workstations, high-performance computing, and IoT services. Nvidia GPU-powered Amazon EC2 instances deliver scalable performance for fast ML training, cost-effective ML inference, versatile remote virtual workstations, and powerful HPC computations. At the edge, AWS IoT Greengrass extends many AWS cloud services to Nvidia-based edge devices, enabling local data processing and action.

Amazon’s stock has significantly outperformed the broader market, with its shares up more than 87% over the previous year and already up more than 15% year to date. The stock has an impressive earnings growth forecast of 30.54% and a Buy rating based on forty-four analyst ratings.

Supermicrocomputer NASDAQ:SMCI

Super Micro Computer is a leading figure in the technology industry, boasting a 30-year legacy. The company specializes in cutting-edge computing solutions for data centers, cloud providers and enterprises. SMCI has emerged as a significant player in manufacturing computers optimized for data center operations, facilitating tasks such as website hosting, data storage and artificial intelligence applications.

The company carefully monitors the development of Nvidia products to ensure seamless compatibility and rapid integration of Nvidia innovations into its products. This approach extends to other chipmakers, allowing Supermicro to take advantage of growth across the industry.

Supermicro has seen an explosive surge in its shares thanks to recent extraordinary earnings. Over the past three months, the stock is up more than 200% and a remarkable 776% from a year earlier. While its current P/E of 67.14 may not be attractive, its forward P/E of 29.91 and Moderate Buy consensus rating paint a more attractive picture.

Direxion Daily Semiconductors Bull 3x shares New York Stock Exchange: SOXL

The Direxion Daily Semiconductor Bull 3X Shares (SOXL) is an exchange-traded fund (ETF) that tracks the ICE Semiconductor Index. This ETF gives investors three times daily exposure to a modified market-cap-weighted index that includes 30 U.S.-traded semiconductor companies

The ETF’s largest individual stock holding is Nvidia, with a weighting of 6.79%, making the ETF related to Nvidia and its significant directional moves. As the overall sector and NVDA rose over the previous year, ETF shares did as well. Year to date, SOXL is up nearly 28% and more than 180% from the previous year.

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