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Benzinga Insights 1-Sep-2025 11:00 AM
In today's rapidly changing and fiercely competitive business landscape, it is vital for investors and industry enthusiasts to carefully evaluate companies. In this article, we will perform a comprehensive industry comparison, evaluating NVIDIA (NASDAQ:NVDA) against its key competitors in the Semiconductors & Semiconductor Equipment industry. By analyzing important financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.
Nvidia is a leading developer of graphics processing units. Traditionally, GPUs were used to enhance the experience on computing platforms, most notably in gaming applications on PCs. GPU use cases have since emerged as important semiconductors used in artificial intelligence to run large language models. Nvidia not only offers AI GPUs, but also a software platform, Cuda, used for AI model development and training. Nvidia is also expanding its data center networking solutions, helping to tie GPUs together to handle complex workloads.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| NVIDIA Corp | 51.33 | 43.88 | 26.89 | 28.72% | $31.94 | $33.85 | 55.6% |
| Broadcom Inc | 112.65 | 20.86 | 26.12 | 7.12% | $8.02 | $10.2 | 20.16% |
| Taiwan Semiconductor Manufacturing Co Ltd | 26.15 | 8.25 | 11.11 | 8.71% | $684.78 | $547.37 | 38.65% |
| Advanced Micro Devices Inc | 100.95 | 4.59 | 9.29 | 1.48% | $0.72 | $3.06 | 31.71% |
| Texas Instruments Inc | 37.31 | 11.31 | 11.22 | 7.85% | $2.09 | $2.58 | 16.38% |
| Qualcomm Inc | 15.52 | 6.38 | 4.15 | 9.71% | $3.52 | $5.76 | 10.35% |
| ARM Holdings PLC | 215.98 | 21.55 | 36.81 | 1.88% | $0.17 | $1.02 | 12.14% |
| Micron Technology Inc | 21.98 | 2.69 | 4.09 | 3.79% | $4.33 | $3.51 | 36.56% |
| Analog Devices Inc | 64.69 | 3.67 | 12.19 | 1.5% | $1.33 | $1.79 | 24.57% |
| NXP Semiconductors NV | 28.49 | 6.30 | 5.04 | 4.71% | $0.92 | $1.56 | -6.43% |
| Monolithic Power Systems Inc | 22.46 | 12.08 | 16.32 | 4.01% | $0.18 | $0.37 | 30.97% |
| STMicroelectronics NV | 58.70 | 1.31 | 2.18 | -0.05% | $0.62 | $0.65 | -14.42% |
| Credo Technology Group Holding Ltd | 454.55 | 33.45 | 54.67 | 5.63% | $0.04 | $0.11 | 179.73% |
| ASE Technology Holding Co Ltd | 20.27 | 2.26 | 1.08 | 2.49% | $26.99 | $25.69 | 7.5% |
| ON Semiconductor Corp | 48.36 | 2.62 | 3.37 | 2.13% | $0.38 | $0.55 | -15.36% |
| First Solar Inc | 16.84 | 2.47 | 4.88 | 4.09% | $0.49 | $0.5 | 8.58% |
| United Microelectronics Corp | 12.25 | 1.52 | 2.13 | 2.45% | $24.98 | $16.88 | 3.45% |
| Skyworks Solutions Inc | 29.92 | 1.97 | 2.96 | 1.81% | $0.23 | $0.4 | 6.57% |
| Lattice Semiconductor Corp | 289.80 | 13.28 | 18.81 | 0.42% | $0.02 | $0.08 | -0.08% |
| Rambus Inc | 38.43 | 7.10 | 13.64 | 4.85% | $0.08 | $0.14 | 30.33% |
| Average | 85.02 | 8.61 | 12.63 | 3.93% | $39.99 | $32.75 | 22.18% |
Through a meticulous analysis of NVIDIA, we can observe the following trends:
The Price to Earnings ratio of 51.33 is 0.6x lower than the industry average, indicating potential undervaluation for the stock.
With a Price to Book ratio of 43.88, which is 5.1x the industry average, NVIDIA might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
The stock's relatively high Price to Sales ratio of 26.89, surpassing the industry average by 2.13x, may indicate an aspect of overvaluation in terms of sales performance.
The Return on Equity (ROE) of 28.72% is 24.79% above the industry average, highlighting efficient use of equity to generate profits.
With lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $31.94 Billion, which is 0.8x below the industry average, the company may face lower profitability or financial challenges.
The gross profit of $33.85 Billion is 1.03x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
With a revenue growth of 55.6%, which surpasses the industry average of 22.18%, the company is demonstrating robust sales expansion and gaining market share.
The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.
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.
In terms of the Debt-to-Equity ratio, NVIDIA stands in comparison with its top 4 peers, leading to the following comparisons:
NVIDIA is in a relatively stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.11.
This implies that the company relies less on debt financing and has a more favorable balance between debt and equity.
For NVIDIA, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB and PS ratios suggest strong market sentiment and revenue multiples. The high ROE reflects efficient use of shareholder equity, while the low EBITDA may indicate room for improvement in operational earnings. The high gross profit margin and revenue growth rate demonstrate strong financial performance and growth potential within the industry sector.
This article was generated by Benzinga's automated content engine and reviewed by an editor.