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Investigating NVIDIA's Standing In Semiconductors & Semiconductor Equipment Industry Compared To Competitors

, Benzinga - 11:00 AM ET 3/18/2025 Technology

In the ever-evolving and intensely competitive business landscape, conducting a thorough company analysis is of utmost importance for investors and industry followers. In this article, we will carry out an in-depth industry comparison, assessing NVIDIA ( NVDA ) alongside its primary competitors in the Semiconductors & Semiconductor Equipment industry. By meticulously examining key financial metrics, market positioning, and growth prospects, we aim to offer valuable insights to investors and shed light on company's performance within the industry.

NVIDIA Background

Nvidia Corp ( NVDA ) is an upfront developer of graphics processing unit and a full-stack computing infrastructure company with data-center-scale offerings that are reshaping industry. Traditionally, GPU were used to enhanvce experience,now Nvidia ( NVDA ) offers AI GPUs, and also a software platform, Cuda, used for AI model development and training. The company is also expanding its data center networking solutions, helping to tie GPUs together to handle complex workloads. such as AI, model training and inference, data analytics, scientific computing, and 3D graphics, with vertical-specific optimizations to address industries ranging from healthcare and telecom to automotive and manufacturing.

Company	P/E	P/B	P/S	ROE	EBITDA (in billions)	Gross Profit (in billions)	Revenue Growth
NVIDIA Corp ( NVDA )	40.66	36.77	22.72	30.42%	$25.82	$28.72	77.94%
Broadcom Inc	90.05	13.10	17.19	8.01%	$8.54	$10.14	24.71%
Taiwan Semiconductor Manufacturing Co Ltd	25.70	7.03	10.42	9.05%	$596.09	$512.38	38.84%
Qualcomm Inc	17.04	6.50	4.38	11.97%	$4.23	$6.51	17.45%
Advanced Micro Devices Inc	104.59	2.94	6.64	0.84%	$1.69	$3.88	24.16%
Texas Instruments Inc	34.61	9.69	10.58	7.02%	$1.92	$2.31	-1.72%
ARM Holdings PLC	159.70	19.93	34.86	4.05%	$0.22	$0.95	19.3%
Micron Technology Inc	29.54	2.45	3.98	4.07%	$4.3	$3.35	84.28%
Analog Devices Inc	67.63	2.99	11.30	1.11%	$1.03	$1.43	-3.56%
Monolithic Power Systems Inc	17.51	9.75	14.18	52.73%	$0.17	$0.34	36.93%
Microchip Technology Inc	96.95	4.93	6.31	-0.87%	$0.21	$0.56	-41.89%
STMicroelectronics NV	15.29	1.30	1.80	1.95%	$0.89	$1.25	-22.42%
ASE Technology Holding Co Ltd	22.30	2.17	1.19	2.94%	$28.59	$26.43	1.35%
ON Semiconductor Corp	12.13	2.11	2.69	4.37%	$0.62	$0.78	-14.65%
United Microelectronics Corp	10.76	1.51	2.41	4.0%	$29.73	$20.43	5.99%
First Solar Inc	11.07	1.79	3.40	5.05%	$0.58	$0.57	30.68%
Skyworks Solutions Inc	21.72	1.77	2.82	2.54%	$0.31	$0.44	-11.07%
Lattice Semiconductor Corp	142.30	12.14	17	2.33%	$0.02	$0.07	-31.17%
Credo Technology Group Holding Ltd	1567.33	12.91	25.33	4.95%	$0.03	$0.09	154.44%
Universal Display Corp	33.66	4.60	11.52	2.87%	$0.06	$0.12	2.51%
Qorvo Inc	260.79	2.02	1.85	1.22%	$0.14	$0.39	-14.67%
Average	137.03	6.08	9.49	6.51%	$33.97	$29.62	14.97%

By carefully studying NVIDIA ( NVDA ), we can deduce the following trends:

With a Price to Earnings ratio of 40.66, which is 0.3x less than the industry average, the stock shows potential for growth at a reasonable price, making it an interesting consideration for market participants.
It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 36.77 which exceeds the industry average by 6.05x.
With a relatively high Price to Sales ratio of 22.72, which is 2.39x the industry average, the stock might be considered overvalued based on sales performance.
With a Return on Equity (ROE) of 30.42% that is 23.91% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $25.82 Billion is 0.76x below the industry average, suggesting potential lower profitability or financial challenges.
Compared to its industry, the company has lower gross profit of $28.72 Billion, which indicates 0.97x below the industry average, potentially indicating lower revenue after accounting for production costs.
The company's revenue growth of 77.94% is notably higher compared to the industry average of 14.97%, showcasing exceptional sales performance and strong demand for its products or services.

Debt To Equity Ratio

debt to equity

The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.

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.

By evaluating NVIDIA ( NVDA ) against its top 4 peers in terms of the Debt-to-Equity ratio, the following observations arise:

Compared to its top 4 peers, NVIDIA ( NVDA ) has a stronger financial position indicated by its lower debt-to-equity ratio of 0.13.
This suggests that the company relies less on debt financing and has a more favorable balance between debt and equity, which can be seen as a positive attribute by investors.

Key Takeaways

The low P/E ratio suggests that NVIDIA ( NVDA ) may be undervalued compared to its peers in the Semiconductors & Semiconductor Equipment industry. However, the high P/B and P/S ratios indicate that the stock may be overvalued based on its book value and sales. On the other hand, the high ROE, low EBITDA, low gross profit, and high revenue growth suggest that NVIDIA ( NVDA ) is performing well in terms of profitability and revenue generation compared to its industry peers.

This article was generated by Benzinga's automated content engine and reviewed by an editor.