In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating NVIDIA NVDA and its primary competitors in the Semiconductors & Semiconductor Equipment industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.
NVIDIA Background
Nvidia is a leading developer of graphics processing units. Traditionally, GPUs were used to enhance the experience on computing platforms, most notably in gaming applications on PCs. GPU use cases have since emerged as important semiconductors used in artificial intelligence. Nvidia not only offers AI GPUs, but also a software platform, Cuda, used for AI model development and training. Nvidia is also expanding its data center networking solutions, helping to tie GPUs together to handle complex workloads.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| NVIDIA Corp | 54.60 | 51.40 | 30.36 | 31.13% | $22.86 | $26.16 | 93.61% |
| Broadcom Inc | 179.83 | 16.07 | 21.49 | 6.49% | $7.29 | $9.0 | 51.2% |
| Taiwan Semiconductor Manufacturing Co Ltd | 32.72 | 8.62 | 12.97 | 8.36% | $555.05 | $439.35 | 38.95% |
| Advanced Micro Devices Inc | 106.75 | 3.44 | 8.12 | 1.36% | $1.55 | $3.42 | 17.57% |
| Qualcomm Inc | 17.19 | 6.50 | 4.46 | 11.46% | $3.21 | $5.78 | 18.69% |
| Texas Instruments Inc | 34.75 | 9.88 | 10.93 | 7.86% | $2.09 | $2.47 | -8.41% |
| ARM Holdings PLC | 211.94 | 22.41 | 38.53 | 1.83% | $0.11 | $0.81 | 4.71% |
| Analog Devices Inc | 64.44 | 2.98 | 11.18 | 1.36% | $1.12 | $1.42 | -10.06% |
| Micron Technology Inc | 25.02 | 2.08 | 3.37 | 4.07% | $4.3 | $3.35 | 84.28% |
| Microchip Technology Inc | 39.50 | 4.87 | 5.63 | 1.24% | $0.34 | $0.67 | -48.37% |
| Monolithic Power Systems Inc | 66.99 | 12.33 | 14.26 | 6.35% | $0.17 | $0.34 | 30.59% |
| ON Semiconductor Corp | 15.31 | 3.06 | 3.64 | 4.75% | $0.63 | $0.8 | -19.21% |
| STMicroelectronics NV | 10 | 1.24 | 1.61 | 1.98% | $0.74 | $1.23 | -26.63% |
| ASE Technology Holding Co Ltd | 20.19 | 2.31 | 1.21 | 3.16% | $28.59 | $26.43 | 3.85% |
| First Solar Inc | 16.06 | 2.63 | 5.21 | 4.22% | $0.45 | $0.45 | 10.81% |
| United Microelectronics Corp | 10.45 | 1.47 | 2.34 | 4.0% | $29.73 | $20.43 | 5.99% |
| Skyworks Solutions Inc | 23.97 | 2.23 | 3.42 | 0.95% | $0.18 | $0.43 | -15.9% |
| MACOM Technology Solutions Holdings Inc | 124.45 | 8.50 | 13.05 | 2.67% | $0.05 | $0.11 | 33.47% |
| Lattice Semiconductor Corp | 54.85 | 10.97 | 13.78 | 1.03% | $0.03 | $0.09 | -33.87% |
| Universal Display Corp | 30.05 | 4.48 | 11.08 | 4.29% | $0.08 | $0.13 | 14.57% |
| Average | 57.08 | 6.64 | 9.8 | 4.08% | $33.46 | $27.2 | 8.01% |
Through a meticulous analysis of NVIDIA, we can observe the following trends:
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At 54.6, the stock's Price to Earnings ratio is 0.96x less than the industry average, suggesting favorable growth potential.
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The elevated Price to Book ratio of 51.4 relative to the industry average by 7.74x suggests company might be overvalued based on its book value.
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The Price to Sales ratio of 30.36, which is 3.1x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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The company has a higher Return on Equity (ROE) of 31.13%, which is 27.05% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.
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The company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $22.86 Billion, which is 0.68x below the industry average. This potentially indicates lower profitability or financial challenges.
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Compared to its industry, the company has lower gross profit of $26.16 Billion, which indicates 0.96x below the industry average, potentially indicating lower revenue after accounting for production costs.
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The company is experiencing remarkable revenue growth, with a rate of 93.61%, outperforming the industry average of 8.01%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio assesses the extent to which a company relies on borrowed funds compared to its equity.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
By evaluating NVIDIA against its top 4 peers in terms of the Debt-to-Equity ratio, the following observations arise:
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When comparing the debt-to-equity ratio, NVIDIA is in a stronger financial position compared to its top 4 peers.
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The company has a lower level of debt relative to its equity, indicating a more favorable balance between the two with a lower debt-to-equity ratio of 0.16.
Key Takeaways
For NVIDIA, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB and PS ratios suggest strong market sentiment and revenue multiples. A high ROE reflects efficient use of shareholder equity. The low EBITDA and gross profit may indicate room for improvement in operational efficiency. The high revenue growth rate signals strong performance in capturing market share.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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