The wealth of the Nvidia’s CEO increased by $3.9 billion only during yesterday's session (this is an increase in the value of Nvidia shares held by Jensen Huang), and by as much as $74.9 billion since the beginning of the year.
Investors have nothing to complain about... because only during yesterday's session the value of their Nvidia shares increased by $113.3 billion, and since the beginning of the year... drum roll please... by $2.11 trillion.
So is Nvidia already expensive?
Price to sale, based on the sum of revenues from the preceding 12 months (TTM), is 41.8x. At the peak of market valuation in March 2000, Cisco Systems achieved a Price to Sales of 63.2x - see Figure 1.
But the Nvidia's revenues are growing rapidly. TTM currently amounts to $79.77 billion. But based on the company's guidance (next quarter annualized company's guidance), they already amount to $112.00 billion - see Figure 2. Price to Sales drops to 29.8x.
Wall Street continues to raise its own estimates of Nvidia's future revenues (see Figure 3) and the current forecast for 4 subsequent quarters is $130.67 billion - thus the Price to Sales drops to 25.5x.
Wall Street forecasts revenues in the another 4 subsequent quarters (from the 5th to the 8th quarter, i.e. from May 2025 to April 2026) at the level of $161.34 billion - which reduces the Price to Sales ratio to (only) 20.7x.
Summary in Figure 4.
