Nvidia's stock surges 6 percent on strong revenue forecasts, upcoming stock split
Date
5/23/2024 2:19:41 AM
(MENAFN) Nvidia's stock experienced a significant surge of about 6 percent in after-hours trading, driven by the company's optimistic revenue forecast for the second quarter, which surpasses analyst expectations. This surge in share price is largely attributed to the growing demand for Nvidia's chips, which are increasingly being adopted by companies implementing artificial intelligence technologies. Nvidia projects its second-quarter revenues to reach USD28 billion, with a margin of error of plus or minus two percent. This forecast is notably higher than the average revenue estimate of USD26.66 billion predicted by analysts, as reported by the London Stock Exchange Group.
In response to these optimistic projections, Nvidia's shares climbed 6 percent to reach USD1,007 in after-hours trading. This rise pushed the stock above the psychologically significant USD1,000 threshold, thereby increasing the company's market value by approximately USD140 billion to a total of USD2.336 trillion. Since the beginning of the year, Nvidia's shares have seen an impressive gain of over 90 percent.
Additionally, Nvidia announced plans to implement a ten-for-one stock split, which will take effect on June 7. This move is likely aimed at making the stock more accessible to a broader range of investors by reducing the price per share. Alongside the stock split, Nvidia revealed it would significantly increase its quarterly dividend by 150 percent, raising it to one cent per share on a post-split basis. This combination of strong revenue forecasts, share price appreciation, and strategic financial maneuvers underscores Nvidia's robust position in the market, particularly as it capitalizes on the expanding role of artificial intelligence technologies.
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