In the competitive world of semiconductors, NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD) stand out as key players, each driving innovation and capturing market share in overlapping technological arenas. Both companies have carved niches in graphics processing and data center solutions, pushing boundaries in AI and gaming technologies. As we delve into their financials, strategies, and market positions, this analysis will help you identify which company might be the more compelling investment opportunity for your portfolio.
Table of contents
Company Overview
NVIDIA Corporation Overview
NVIDIA Corporation (NVDA) is a leading player in the semiconductor industry, renowned for its innovation in graphics, computing, and networking solutions. The company aims to deliver advanced technologies that enhance the performance and efficiency of gaming, professional visualization, data centers, and automotive markets. Headquartered in Santa Clara, CA, NVIDIA specializes in high-performance graphics processing units (GPUs) and has expanded into AI and accelerated computing platforms. With a substantial market cap of approximately 4.33T USD, NVIDIA’s products, such as GeForce GPUs and AI enterprise software, cater to both consumers and enterprises, positioning it as a cornerstone in the evolving tech landscape.
Advanced Micro Devices, Inc. Overview
Advanced Micro Devices, Inc. (AMD) is another prominent semiconductor company that operates globally, focusing on developing high-performance computing and graphics solutions. Founded in 1969 and also based in Santa Clara, CA, AMD’s mission revolves around pushing the boundaries of technology through its diverse product offerings, including microprocessors, GPUs, and semi-custom solutions for game consoles. With a market cap of around 335B USD, AMD serves a wide range of customers, from original equipment manufacturers to public cloud service providers, establishing itself as a competitive force against its primary rival, NVIDIA.
Key similarities and differences in their business models: Both NVIDIA and AMD operate within the semiconductor industry, focusing on high-performance graphics and computing solutions. However, NVIDIA has a stronger emphasis on AI and data center technologies, while AMD’s strength lies in its diverse product offerings across consumer and enterprise markets, particularly in microprocessors and semi-custom solutions.
Income Statement Comparison
The following table compares the most recent income statements of NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD) for the fiscal year 2024.
| Metric | NVIDIA (NVDA) | AMD (AMD) |
|---|---|---|
| Revenue | 130.5B | 25.8B |
| EBITDA | 86.1B | 5.3B |
| EBIT | 84.3B | 2.1B |
| Net Income | 72.9B | 1.6B |
| EPS | 2.97 | 1.01 |
Interpretation of Income Statement
NVIDIA shows exceptional growth in revenue and net income, with a staggering increase to 130.5B and 72.9B, respectively, compared to prior periods. Their EBITDA margin of around 66% highlights operational efficiency. Meanwhile, AMD’s revenue of 25.8B reflects a solid performance, though significantly lower than NVIDIA’s. The net income for AMD stands at 1.6B, reflecting a stable, yet modest growth trajectory. Overall, NVIDIA’s robust growth suggests market dominance, while AMD’s performance indicates steady recovery amid competitive pressures.
Financial Ratios Comparison
In this section, I present a comparative analysis of key financial metrics for NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD). This comparison will help investors assess the financial health and performance of these companies.
| Metric | NVDA | AMD |
|---|---|---|
| ROE | 91.87% | 2.85% |
| ROIC | 75.28% | 2.48% |
| P/E | 39.90 | 123.59 |
| P/B | 36.66 | 3.52 |
| Current Ratio | 4.44 | 2.62 |
| Quick Ratio | 3.88 | 1.83 |
| D/E | 0.13 | 0.04 |
| Debt-to-Assets | 9.20% | 3.35% |
| Interest Coverage | 329.77 | 20.65 |
| Asset Turnover | 1.17 | 0.37 |
| Fixed Asset Turnover | 16.16 | 10.63 |
| Payout Ratio | 1.14% | 0% |
| Dividend Yield | 0.03% | 0% |
Interpretation of Financial Ratios
NVIDIA’s ratios reflect a robust financial position, particularly its high ROE and ROIC, indicating effective capital utilization. In contrast, AMD’s significantly lower ratios raise potential concerns about its profitability and financial leverage. While AMD shows decent liquidity, its high P/E ratio suggests overvaluation relative to earnings. Investors should weigh these factors against their risk tolerance before making investment decisions.
Dividend and Shareholder Returns
NVIDIA Corporation (NVDA) has a modest dividend payout ratio of 1.1%, indicating a small annual dividend yield of 0.03%. The company has also engaged in share buyback programs, highlighting its commitment to returning value to shareholders. However, its high valuation metrics suggest potential risks of unsustainable distributions.
In contrast, Advanced Micro Devices, Inc. (AMD) does not pay dividends, prioritizing reinvestment for growth. This strategy aligns with long-term shareholder value creation, as AMD focuses on R&D and expansion. Neither company is currently distributing dividends, but both are investing in share buybacks, supporting shareholder returns in different ways.
Strategic Positioning
As of 2025, NVIDIA (NVDA) commands a substantial market share in the semiconductor industry, particularly in graphics processing units (GPUs), with a market cap of approximately $4.33T. In contrast, AMD (AMD) holds a market cap of around $335B, indicating strong competition. Both companies face intense competitive pressure, especially from emerging technologies like AI and machine learning, which could disrupt traditional market dynamics. As I evaluate these firms, I remain cautious about the potential impacts of technological advancement and market volatility.
Stock Comparison
In the past year, NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD) have exhibited significant price movements, with both stocks showing a strong bullish trend overall. This analysis will focus on the key dynamics and shifts in their stock prices as we examine their recent performance.
Trend Analysis
NVIDIA Corporation (NVDA) Over the past year, NVDA has experienced a remarkable price change of +262.16%, indicating a bullish trend. However, the trend shows signs of deceleration despite the substantial increase. The stock reached a notable high of $202.49 and a low of $49.10, with a standard deviation of 35.0 reflecting moderate volatility. Recent trends from September 14, 2025, to November 30, 2025, indicate no percentage change, suggesting a period of stabilization.
Advanced Micro Devices, Inc. (AMD) AMD’s stock has also shown a strong performance, with a price change of +48.74% over the last year, reflecting a bullish trend. The trend is currently accelerating, with the stock hitting a high of $256.12 and a low of $85.76. The standard deviation of 35.61 indicates a similar level of volatility as NVDA. Recent analysis from September 14, 2025, to November 30, 2025, reveals a significant price increase of +29.99%, suggesting that AMD continues to gain momentum.
In summary, both NVDA and AMD have demonstrated strong positive price movements, but investors should remain mindful of the trends’ acceleration or deceleration as they make decisions.
Analyst Opinions
Recent analyst recommendations for NVIDIA Corporation (NVDA) suggest a “Buy” rating with a solid overall score of 3. Analysts highlight strong return on equity (5) and return on assets (5), bolstering confidence in the company’s growth potential. In contrast, Advanced Micro Devices, Inc. (AMD) holds a “Hold” rating with an overall score of 3, where analysts note balanced performance but caution against overexposure due to lower return metrics. The consensus for the current year leans toward a “Buy” for NVDA while recommending a more cautious stance on AMD.
Stock Grades
In this section, I present the latest stock ratings for NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD) based on reliable grading data.
NVIDIA Corporation Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Melius Research | maintain | Buy | 2025-11-20 |
| Argus Research | maintain | Buy | 2025-11-20 |
| Benchmark | maintain | Buy | 2025-11-20 |
| Keybanc | maintain | Overweight | 2025-11-20 |
| Rosenblatt | maintain | Buy | 2025-11-20 |
| JP Morgan | maintain | Overweight | 2025-11-20 |
| Bernstein | maintain | Outperform | 2025-11-20 |
| Citigroup | maintain | Buy | 2025-11-20 |
| Cantor Fitzgerald | maintain | Overweight | 2025-11-20 |
| Barclays | maintain | Overweight | 2025-11-20 |
Advanced Micro Devices, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Mizuho | maintain | Outperform | 2025-11-12 |
| Evercore ISI Group | maintain | Outperform | 2025-11-12 |
| Rosenblatt | maintain | Buy | 2025-11-12 |
| B of A Securities | maintain | Buy | 2025-11-12 |
| Morgan Stanley | maintain | Equal Weight | 2025-11-12 |
| Wedbush | maintain | Outperform | 2025-11-12 |
| Piper Sandler | maintain | Overweight | 2025-11-12 |
| Wells Fargo | maintain | Overweight | 2025-11-12 |
| Roth Capital | maintain | Buy | 2025-11-12 |
| Wedbush | maintain | Outperform | 2025-11-10 |
Overall, both NVIDIA and AMD have maintained strong grades from various reputable firms, indicating a positive sentiment in the market. Notably, both companies feature a mix of “Buy,” “Overweight,” and “Outperform” ratings, which suggests a strong outlook for investors considering these stocks for their portfolios.
Target Prices
Recent analyses provide reliable target prices for NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD), reflecting a consensus among analysts.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| NVIDIA Corporation | 352 | 200 | 261.77 |
| Advanced Micro Devices | 380 | 200 | 295.24 |
For NVIDIA, the target consensus of 261.77 is notably above its current price of 177.82, indicating potential upside. Similarly, AMD’s consensus of 295.24 also suggests a favorable outlook compared to its current price of 206.13. These targets suggest that analysts remain optimistic about both companies’ future performance.
Strengths and Weaknesses
The following table highlights the strengths and weaknesses of NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD), focusing on key performance criteria.
| Criterion | NVIDIA Corporation (NVDA) | Advanced Micro Devices, Inc. (AMD) |
|---|---|---|
| Diversification | High (multiple segments) | Moderate (focused on semiconductors) |
| Profitability | Strong (Net Profit Margin: 55.8%) | Low (Net Profit Margin: 6.4%) |
| Innovation | High (leading in AI/ML tech) | Moderate (growing product lines) |
| Global presence | Extensive (global operations) | Significant (growing international market) |
| Market Share | High (dominates GPU market) | Moderate (gaining in CPU market) |
| Debt level | Low (Debt to Equity: 0.13) | Very Low (Debt to Equity: 0.04) |
In summary, NVIDIA stands out for its strong profitability and innovation, while AMD is notable for its low debt levels. Investors should weigh these factors carefully when considering their investment options.
Risk Analysis
In this section, I present a summary of the key risks associated with NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD).
| Metric | NVIDIA Corporation (NVDA) | Advanced Micro Devices, Inc. (AMD) |
|---|---|---|
| Market Risk | High (Beta: 2.269) | Moderate (Beta: 1.913) |
| Regulatory Risk | Moderate | High |
| Operational Risk | Moderate | High |
| Environmental Risk | Low | Moderate |
| Geopolitical Risk | High | Moderate |
Both NVIDIA and AMD face notable market and operational risks, especially given their significant beta values, indicating high volatility. Recent market shifts and geopolitical tensions in tech supply chains could further exacerbate these risks.
Which one to choose?
When comparing NVIDIA Corporation (NVDA) and Advanced Micro Devices, Inc. (AMD), NVDA appears to have stronger fundamentals. NVDA boasts a gross profit margin of 75%, compared to AMD’s 49%. Moreover, NVDA’s net profit margin stands at 55.8%, while AMD’s is only 6.4%. In terms of growth potential, NVDA’s price-to-earnings (P/E) ratio of 39.9 indicates a more favorable valuation compared to AMD’s significantly higher P/E of 123.6. Analyst ratings reflect this sentiment, with NVDA rated at B+ versus AMD’s B. NVDA’s stock has shown a bullish trend with a 262% price change over the past year, while AMD’s price change is 48%.
For growth-focused investors, I suggest considering NVDA, while those seeking a value play may find AMD appealing despite its risks related to market dependence and competition.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of NVIDIA Corporation and Advanced Micro Devices, Inc. to enhance your investment decisions:
