ETFs to Bet On as NVIDIA Reclaims Market Cap Crown

NVIDIA NVDA reclaimed the position of the world’s most valuable company, boasting a market capitalization of $3.45 trillion. The AI darling surpassed Microsoft MSFT, after a meteoric run driven by unrelenting demand for its artificial intelligence (AI) hardware. 

The milestone isn’t just a symbolic victory. It signals a deeper shift in how investors are valuing the future of technology, placing AI infrastructure at the very core (read: NVIDIA Reclaims $3 Trillion: ETFs to Bet On).

The Trillion-Dollar Rally

Since bottoming at just over $94 in early April, NVIDIA stock has soared nearly 50%, adding over $1 trillion in market cap in less than two months. That rally was supercharged by robust first-quarter earnings, continued strength in AI chip demand and major expansion plans.

Even with U.S. export restrictions limiting sales to China, NVIDIA has managed to accelerate delivery of its cutting-edge Blackwell AI servers to core customers like Microsoft and other hyperscalers. This is not just resilience, it’s strategic dominance.

Quick Takeaway on Latest Earnings Results

Though the AI darling lagged the Zacks Consensus Estimate, it reported record-breaking revenues largely driven by a booming data center business and incredible demand for its latest AI chips. Data Center revenues, which account for much of NVIDIA’s revenues, jumped 73% year over year to $39.1 billion (read: ETFs to Buy After NVIDIA's Q1 Earnings Miss, Record Revenues).

AI to Fuel Growth

The demand for NVIDIA’s AI chips, especially for large cloud providers and AI supercomputing, continues to surge. NVIDIA is building factories in the United States and working with its partners to produce AI supercomputers. NVIDIA CEO Jensen Huang said, "Countries around the world are recognizing AI as essential infrastructure – just like electricity and the internet – and NVIDIA stands at the center of this profound transformation."  

Its chief financial officer, Colette Kress, said that Microsoft has “deployed tens of thousands of Blackwell GPUs and is expected to ramp to hundreds of thousands” of the company’s GB200 product, due largely to its partnership with OpenAI.

Global Expansions

NVIDIA is also accelerating its global expansion. It recently announced plans to build AI factories in the United States and Saudi Arabia and launched the Stargate UAE AI infrastructure cluster in Abu Dhabi. Furthermore, NVIDIA has expanded collaborations with major cloud providers, including Oracle, Google, and Microsoft. Its Blackwell-based cloud instances are now available on AWS, Google Cloud, Microsoft Azure and Oracle Cloud Infrastructure.

CEO Jensen Huang revealed the company is considering the development of a new AI chip designed specifically for the Chinese market. The move comes in response to expanded U.S. government export controls that have effectively blocked the sale of NVIDIA’s H20 chips — part of its high-performance Hopper series — to China.

Valuation Appears Good

With the massive gains, NVIDIA is back in positive territory for the year, gaining 5%. The stock is currently trading at a P/E ratio of 32.40, slightly lower than 32.80 for the Semiconductor - General industry. Analysts remain optimistic about the chipmaker’s growth prospects, citing strong demand for AI chips and strategic international partnerships. 

Further, the stock is currently trading at a PEG ratio of 1.15, much lower than the industry average of 2.18. The lower the PEG ratio, the better the value, as investors would pay less for each unit of earnings.

ETFs to Tap

While there are many ETFs in the space that could capitalize on the solid growth of NVIDIA, we have highlighted those that have the largest allocation to the AI chipmaker.   

Strive U.S. Semiconductor ETF (SHOC) – NVIDIA exposure: 23.3%

VanEck Vectors Semiconductor ETF (SMH) – NVIDIA exposure: 21.5%

VanEck Fabless Semiconductor ETF (SMHX) - NVIDIA exposure: 21.2%

YieldMax Target 12 Semiconductor Option Income ETF (SOXY) - NVIDIA exposure: 19.8%

Columbia Select Technology ETF (SEMI) - NVIDIA exposure: 17.6%

Single-Stock ETFs

Risk-aggressive investors could bet on single-stock ETFs with 200% exposure to NVIDIA. These include the T-REX 2X Long NVIDIA Daily Target ETF NVDX and the GraniteShares 2x Long NVDA Daily ETF NVDL (read: Guide to the 10 Most Popular Leveraged ETFs).

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This article originally published on Zacks Investment Research (zacks.com).

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