Nvidia's Stock Split and Tesla's Investment: What You Need to Know Before the June 7th Event

Santa Clara, California United States of America
Data center revenue jumped by 427% to $22.6 billion.
Nvidia is set to undergo a 10-for-1 stock split on June 7th.
Nvidia's quarterly dividend after the split will be one cent per share, each priced at around $116.
Tesla is expected to spend between $3-4 billion on Nvidia hardware this year for AI purposes.
The company reported a 260% increase in revenue compared to the first quarter of 2023.
Nvidia's Stock Split and Tesla's Investment: What You Need to Know Before the June 7th Event

Nvidia, the world's second most valuable tech company after Apple, is set to undergo a 10-for-1 stock split on June 7th. The announcement came alongside strong first quarter earnings and news of Tesla's significant investment in Nvidia hardware for artificial intelligence purposes.

The stock split will make each share worth one tenth of its previous value, making it more accessible to investors. However, the price surge before the split has raised questions about whether this is a wise investment move.

Nvidia's shares hit an all-time high of $1,199 on Wednesday before the announcement. The company reported a 260% increase in revenue compared to the first quarter of 2023, with data center revenue jumping by 427% to $22.6 billion.

Tesla is expected to spend between $3-4 billion on Nvidia hardware this year, making up roughly 30-40% of the company's artificial intelligence spending. This revelation came after Tesla CEO Elon Musk announced the investment on Twitter.

Amazon and Alphabet, two other tech giants, have never paid dividends and will make their first ever payments on June 17th (of 20 cents per $175 share for Alphabet) and an undisclosed amount for Amazon. Nvidia's quarterly dividend after the split will be one cent per share, each priced at around $116.

Despite the strong earnings and Tesla's significant investment, some analysts advise caution when investing in Nvidia due to its high valuation and lack of a consistent dividend payment.

Nvidia's stock split is not the only unusual trading activity surrounding the company. Unusual activity has been observed in NVDA put options with strike prices below the current price and expiring on June 7th.


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Confidence

90%

Doubts
  • Are there any potential risks associated with investing in Nvidia after the stock split?
  • How will the stock split affect long term investors?
  • Is Tesla's investment enough to sustain Nvidia's growth?

Sources

96%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Nvidia stock split: Investors who hold shares by end of Thursday trading to be impacted

USA Today James Powel Wednesday, 05 June 2024 00:00
  • Unique Points
    • Nvidia became the second most valuable company in the world after passing Apple’s valuation of $3 trillion.
    • Tesla is likely spending between $3-4 billion on Nvidia hardware this year, making up roughly 30-40% of the company’s artificial intelligence spending.
  • Accuracy
    • Nvidia stock split: Investors holding shares by end of Thursday trading will receive nine additional shares.
    • Nvidia will undergo a stock split on June 7th, making each share worth one tenth of its previous value.
    • The value of the shares will be adjusted to reflect the split.
    • Trading on the split value price will begin on Monday.
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

96%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Should you buy pricey stocks like Nvidia?

The Economist Intelligence Unit Limited The Economist Wednesday, 05 June 2024 00:00
  • Unique Points
    • Nvidia will undergo a stock split on June 7th, making each share worth one tenth of its previous value.
    • Amazon has never paid a dividend and Alphabet will make its first ever dividend payment on June 17th (of 20 cents per $175 share).
    • Nvidia’s quarterly dividend after the split will be one cent per share, each priced at around $116.
  • Accuracy
    • Nvidia reported an over $260% increase in revenue compared to Q1 2023.
    • Amazon has never paid a dividend.
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

95%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Nvidia Stock Hits New All-Time High Ahead Of 10-For-1 Split

Forbes Magazine Derek Saul Wednesday, 05 June 2024 00:00
  • Unique Points
    • Nvidia shares hit a new all-time high of $1,199 on Wednesday
    • Nvidia will execute a 10-for-1 stock split after Friday’s market close
    • Historically, companies execute stock splits to make their shares more accessible
  • Accuracy
    • Historically, companies execute stock splits to make their shares more accessible, but it’s a procedural move with today’s fractional trading
  • Deception (100%)
    None Found At Time Of Publication
  • Fallacies (95%)
    The article contains an appeal to authority fallacy when it states 'Bank of America analysts upped its price target for Nvidia to a Wall Street-leading $1,500 per share.' This implies that the opinion of Bank of America analysts is authoritative and should be trusted without question. However, this is not the case as their opinions are not infallible and can be influenced by various factors.
    • Bank of America analysts upped its price target for Nvidia to a Wall Street-leading $1,500 per share.
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (100%)
    None Found At Time Of Publication

79%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Unusual Trades in Nvidia Options Ahead of the 10-for-1 NVDA Stock Split After June 7

Nasdaq Thursday, 06 June 2024 04:44
  • Unique Points
    • NVDA stock will split on a 10-for-1 basis after the close of trading on June 7.
    • Each contract represents 100 shares after the split.
    • Unusual activity in NVDA put options with strike prices below current price and expiring on June 7.
  • Accuracy
    • The stock price will start trading on Monday, June 10, at a price 90% below the close.
  • Deception (5%)
    The article contains selective reporting and emotional manipulation. The author highlights unusual put option activity in Nvidia (NVDA) ahead of the stock split, implying that traders are taking advantage of the upcoming event. However, the author fails to mention that there is also unusual call option activity, which could indicate bullish sentiment on NVDA. This selective reporting creates a misleading impression for readers. Additionally, the author expresses his personal opinion that NVDA stock still looks cheap and could be worth $149 post-split. While this may be true, it is not relevant to the unusual option activity discussed in the article and serves only to manipulate emotions by creating excitement around potential price increases.
    • Here is what I think is going on. Traders are likely taking advantage of the high options premiums by shorting them.
    • The net result of this unusual activity is that NVDA is up about 3% today to $1,199.44 in midday trading on June 5.
    • I discussed why NVDA stock still looks cheap in my prior two Barchart articles.
  • Fallacies (100%)
    None Found At Time Of Publication
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (100%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (0%)
    None Found At Time Of Publication

75%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Nvidia Is Conducting a 10-for-1 Stock Split: 7 Reasons to Completely Avoid Wall Street's Hottest Artificial Intelligence (AI) Stock

The Motley Fool Sean Williams Wednesday, 05 June 2024 09:06
  • Unique Points
    • Nvidia is conducting a 10-for-1 stock split.
    • No insider has purchased shares of Nvidia over the past 41 months.
  • Accuracy
    • Nvidia reported an over $260% increase in revenue compared to Q1 2023, with data center revenue jumping 427% to $22.6 billion.
    • Amazon and Alphabet both underwent stock splits two years ago.
    • Nvidia will execute a 10-for-1 stock split after Friday’s market close
    • Nvidia was the eighth company to announce a stock split this year and follows big technology peers Alphabet, Amazon and Tesla in splitting its shares over the last two years
  • Deception (20%)
    The article contains several instances of editorializing and selective reporting. The author makes numerous assertions about the future performance of Nvidia and its competitors without providing any concrete evidence or peer-reviewed studies to back up these claims. This constitutes deceptive practices as outlined in the analysis rules.
    • , new competitors are entering the AI-GPU arena. Intel is slated to launch its Gaudi 3 AI accelerator chip during the third quarter, while Advanced Micro Devices has been steadily ramping up the rollout of its MI300X GPU, which is a direct competitor to Nvidia’s H100 GPU.
    • Nvidia’s fiscal second-quarter forecast calls for its gross margin to retrace by 235 to 335 basis points, which may be indicative of a peak in pricing power for its AI infrastructure.
    • The reason investors have flocked to stock-split stocks -- and more specifically, companies enacting forward splits, like Nvidia -- is because they have lengthy track records of out-innovating and out-executing their competition.
  • Fallacies (85%)
    The author uses several informal fallacies throughout the article. He makes an appeal to authority by mentioning that Wall Street's most influential businesses are developing AI chips and that they account for about 40% of Nvidia's net sales. He also uses fear tactics by warning of potential trouble to come due to recession-predicting tools and stock market indicators. Additionally, the author makes a hasty generalization when he states that every next-big-thing investment trend has worked its way through a bubble-bursting event in the early stages of its adoption.
    • Wall Street’s most influential businesses are developing AI chips and they account for about 40% of Nvidia’s net sales.
    • , and they all intend to deploy in-house Ai chips into their data centers.
    • For instance, we’ve witnessed the first notable drop in U.S. M2 money supply since the Great Depression.
    • The five previous instances where the Shiller P/E surpassed 30 during a bull market run were eventually followed by declines in the S&P 500 and/or Dow Jones Industrial Average of at least 20%.
  • Bias (95%)
    The author expresses a negative opinion towards investing in Nvidia stock despite its popularity and recent success. He provides seven reasons to avoid the stock, which include potential peaking of AI-GPU pricing power due to new competitors, rising internal competition from top customers developing their own chips, export restrictions to China, lack of insider purchases in over three years, historical trends of next-big-thing investments bubbling and bursting, recession and stock market correction signals, and a high valuation that harks back to the dot-com bubble.
    • Although nothing is more popular right now than artificial intelligence (AI) and stock splits, Wall Street’s darling AI stock is rife with red flags.
      • Even if Nvidia’s H100 and successor chips retain a compute advantage over Intel, AMD, and other future contenders in AI-accelerated data centers, the mere presence of these chips on the market reduces the overwhelming supply scarcity that sent Nvidia’s GPU prices into the stratosphere in the first place.
        • For instance, we’ve witnessed the first notable drop in U.S. M2 money supply since the Great Depression.
          • In response to these restrictions, Nvidia developed the toned-down A800 and H800 GPUs specifically for China. Last year, U.S. regulators restricted the export of these chips to China, as well.
            • Let’s start with the obvious: new competitors are entering the AI-GPU arena.
              • On trailing-12-month (TTM) price-to-sales basis, Nvidia harks back to the peak of the dot-com bubble.
              • Site Conflicts Of Interest (100%)
                None Found At Time Of Publication
              • Author Conflicts Of Interest (100%)
                None Found At Time Of Publication