Alphabet vs NVIDIA

Both Alphabet Inc. and NVIDIA Corporation are two technology giants that have seen significant growth in the stock market over the past few years. Alphabet, the parent company of Google, dominates the online search and advertising market, while NVIDIA is a leading provider of graphics processing units for gaming, artificial intelligence, and data centers. Both companies have seen their stocks rise steadily, but they have unique strengths and weaknesses that set them apart in the competitive tech industry. Let's take a deeper look at how these two companies stack up against each other in the stock market.

Alphabet or NVIDIA?

When comparing Alphabet and NVIDIA, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Alphabet and NVIDIA.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Alphabet has a dividend yield of 0.36%, while NVIDIA has a dividend yield of 0.03%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Alphabet reports a 5-year dividend growth of 0.00% year and a payout ratio of 2.81%. On the other hand, NVIDIA reports a 5-year dividend growth of -23.48% year and a payout ratio of 1.02%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Alphabet P/E ratio at 23.30 and NVIDIA's P/E ratio at 61.02. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Alphabet P/B ratio is 6.79 while NVIDIA's P/B ratio is 55.62.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Alphabet has seen a 5-year revenue growth of 1.47%, while NVIDIA's is 1.68%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Alphabet's ROE at 30.48% and NVIDIA's ROE at 115.52%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $166.05 for Alphabet and $128.74 for NVIDIA. Over the past year, Alphabet's prices ranged from $121.46 to $193.31, with a yearly change of 59.16%. NVIDIA's prices fluctuated between $39.23 and $140.76, with a yearly change of 258.81%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.