As Nvidia's stock split takes effect, this stat shows how far it's come

By Emily Bary

It actually hasn't been that long since Nvidia shares last traded around $120 on a pre-split basis

Nvidia Corp.'s stock is trading Monday near $120, a function of the company's 10-for-1 stock split that was enacted after Friday's close.

The lower, split-adjusted stock price could seem jarring to investors who got used to recent Nvidia share prices (NVDA) near $1,200. But it actually hasn't been that long since Nvidia shares last traded around $120 on a pre-split basis, encapsulating the company's stunning ascent over the past few years.

Don't miss: This chart shows Nvidia's meteoric rise as 'Jensenity' continues

The last time Nvidia shares traded at $120 based on pre-split prices was in October 2022. That's another way of showing that it took Nvidia less than two years to drive a 900% increase in its stock price.

Read: What Nvidia's stock split means for investors

Analysts see further gains ahead, with TD Cowen's Matthew Ramsay adjusting his model for the split over the weekend, "proving we can divide by 10" but also boosting his split-adjusted price target to $140 from $120.

In his latest note, Ramsay also updated his model to include data-center estimates over a longer time horizon. "Overall, this long-term model demonstrates an ability for Nvidia to generate nearly $6.00 in (split-adjusted, so that's really $60 in EPS as of last week) earnings" by calendar 2030, he wrote.

That's actually "a relatively conservative estimate," in his view, "considering significant levers available to the company such as share repurchase and ongoing margin leverage."

Ramsay highlighted the wide gap between his $6 base-case earnings-per-share estimate and the nearly $15 estimate implied by his bull case for 2023.

And for investors who think Nvidia already rules the S&P 500 SPX, Evercore ISI analyst Mark Lipacis outlined a path for the stock to become even more dominant within the index. Nvidia has a similar weighting to Apple Inc. within the S&P 500, at around 6% to 7%, he flagged. But Lipacis thinks Nvidia's weighting could grow to 10% to 15% as the market is still in the midst of a transition into a new computing era.

"In each successive computing era we have observed that the dominant ecosystem players have accounted for an increasingly larger weighting of the S&P 500," he wrote in a weekend report.

See more: A 'generational opportunity' could see Nvidia become 15% of the S&P 500

-Emily Bary

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06-10-24 1026ET