NVDA Stock Alert: Nvidia is racing toward the $3 trillion mark

Despite an already outstanding performance, tech giant NVIDIA (NASDAQ:NVDA) continues to march toward what appears to be its next logical goal: a $3 trillion market cap. The reason for this is an impending stock split and a seemingly invincible deal. Still, there are a few voices that have raised concerns about a bubble forming in NVDA stock.

First, the giant’s rise is nothing short of remarkable. Thanks to its highly relevant business – providing graphics processors that underpin applications and protocols based on artificial intelligence – NVDA stock has gained 151% since the beginning of the year. At the time of writing, its market capitalization stands at $2.97 trillion. If it were to reach $3 trillion soon, that would be a record.

Accordingly The Wall Street Journal, Apple (NASDAQ:AAPL) And Microsoft (NASDAQ:MSFT) needed 719 and 650 trading sessions, respectively, to jump from the $2 trillion mark to $3 trillion. ReutersNVDA stock briefly reached a $2 trillion valuation on February 23.

Of course, with this strong performance comes the reality that the price per share is too high for retail investors who don’t have access to fractional ownership. Splitting NVDA shares doesn’t fundamentally change the action itself. However, the move dilutes the pool of shares to make each unit cheaper, thereby improving accessibility. This, in turn, could lead to retail investors who haven’t previously gotten into the stock to jump in.

NVDA shares are booming, but concerns remain

It’s not just the stock split that gets investors excited about NVDA stock. The main focus has always been the business. With Nvidia delivering the advanced graphics processors that large enterprises need for their AI initiatives, among other bandwidth-intensive innovations, there seems to be no shortage of excitement.

As Adam Gold, founder and chief investment officer at Katam Hill LLCexplained: “It’s like trying to catch a marathon runner who is running at full speed. They have been in the race for a long time. They have a big lead at the moment and are ready to extend it this year and next year.”

It’s hard to reject the analogy. modern micro devices (NASDAQ:AMD) And Intel (NASDAQ:INTC) throw their hat into the ring, their AI competition does not yet come close to Nvidia’s enormous capabilities.

At the same time, some voices urged caution. JP Scandalios, Senior Vice President and Portfolio Manager at Franklin Equity Groupadmits that he is “a little nervous” because of the considerable hype surrounding NVDA stock. Nevertheless, he is overall optimistic about the long-term development.

Less successful is Rob Arnott, chairman and founder of Research partnerships“When narratives get ahead of themselves, it’s when they extrapolate current trends into the future. Nvidia’s revenue has doubled in 12 months. Fantastic. How long will that last?”

Ultimately, Arnott believes NVDA shareholders should stay the course, but he also warns that “bubbles stay until they don’t.”

On the day of release, Josh Enomoto had (neither directly nor indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com policies. Publishing guidelines.