In the fast-paced and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating NVIDIA NVDA in comparison to its major competitors within the Semiconductors & Semiconductor Equipment industry. By analyzing crucial financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in 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 | 54.80 | 51.59 | 30.47 | 31.13% | $22.86 | $26.16 | 93.61% |
| Taiwan Semiconductor Manufacturing Co Ltd | 31.88 | 8.40 | 12.63 | 8.36% | $555.05 | $439.35 | 38.95% |
| Broadcom Inc | 144.54 | 12.73 | 17.72 | -2.77% | $6.39 | $8.36 | 47.27% |
| Advanced Micro Devices Inc | 115.81 | 3.73 | 8.81 | 1.36% | $1.55 | $3.42 | 17.57% |
| Qualcomm Inc | 17.98 | 6.80 | 4.66 | 11.46% | $3.21 | $5.78 | 18.69% |
| Texas Instruments Inc | 35.96 | 10.22 | 11.31 | 7.86% | $2.09 | $2.47 | -8.41% |
| ARM Holdings PLC | 230.86 | 24.41 | 41.97 | 1.83% | $0.11 | $0.81 | 4.71% |
| Micron Technology Inc | 146.89 | 2.54 | 4.58 | 1.99% | $3.63 | $2.74 | 93.27% |
| Analog Devices Inc | 66.78 | 3.09 | 11.59 | 1.36% | $1.12 | $1.42 | -10.06% |
| Microchip Technology Inc | 42.97 | 5.29 | 6.12 | 1.24% | $0.34 | $0.67 | -48.37% |
| Monolithic Power Systems Inc | 68.73 | 12.65 | 14.63 | 6.35% | $0.17 | $0.34 | 30.59% |
| ON Semiconductor Corp | 16.79 | 3.36 | 3.99 | 4.75% | $0.63 | $0.8 | -19.21% |
| STMicroelectronics NV | 10.92 | 1.36 | 1.75 | 1.98% | $0.74 | $1.23 | -26.63% |
| ASE Technology Holding Co Ltd | 20.13 | 2.31 | 1.21 | 3.16% | $28.59 | $26.43 | 3.85% |
| First Solar Inc | 17.23 | 2.82 | 5.58 | 4.22% | $0.45 | $0.45 | 10.81% |
| United Microelectronics Corp | 10.56 | 1.48 | 2.37 | 4.0% | $29.73 | $20.43 | 5.99% |
| Skyworks Solutions Inc | 24.30 | 2.26 | 3.47 | 0.95% | $0.18 | $0.43 | -15.9% |
| MACOM Technology Solutions Holdings Inc | 132.57 | 8.86 | 13.90 | 2.67% | $0.05 | $0.11 | 33.47% |
| Lattice Semiconductor Corp | 59.29 | 11.86 | 14.89 | 1.03% | $0.03 | $0.09 | -33.87% |
| Universal Display Corp | 31.71 | 4.72 | 11.69 | 4.29% | $0.08 | $0.13 | 14.57% |
| Average | 64.52 | 6.78 | 10.15 | 3.48% | $33.38 | $27.13 | 8.28% |
When conducting a detailed analysis of NVIDIA, the following trends become clear:
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The stock's Price to Earnings ratio of 54.8 is lower than the industry average by 0.85x, suggesting potential value in the eyes of market participants.
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With a Price to Book ratio of 51.59, which is 7.61x the industry average, NVIDIA might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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The Price to Sales ratio of 30.47, which is 3.0x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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With a Return on Equity (ROE) of 31.13% that is 27.65% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $22.86 Billion is 0.68x below the industry average, suggesting potential lower profitability or financial challenges.
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The company has lower gross profit of $26.16 Billion, which indicates 0.96x below the industry average. This potentially indicates lower revenue after accounting for production costs.
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The company's revenue growth of 93.61% exceeds the industry average of 8.28%, indicating strong sales performance and market outperformance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative 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.
When comparing NVIDIA with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:
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Among its top 4 peers, NVIDIA has a stronger financial position with a lower debt-to-equity ratio of 0.16.
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This indicates that the company relies less on debt financing and maintains a more favorable balance between debt and equity, which can be viewed positively by investors.
Key Takeaways
The PE, PB, and PS ratios for NVIDIA are indicating that the stock is relatively undervalued compared to its peers in the Semiconductors & Semiconductor Equipment industry. On the other hand, the high ROE, low EBITDA, low gross profit, and high revenue growth suggest that NVIDIA is performing well and has strong growth potential within the industry sector.
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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