NVIDIA Stock Hands $97 Bil Back – Worth a Look

NVIDIA Stock Hands $97 Bil Back - Worth a Look?

In the last five years, NVIDIA (NVDA) stock has returned a notable $97 Bil back to its shareholders through cold, hard cash via dividends and buybacks. Let's look at some numbers and compare how this payout power stacks up against the market's biggest capital-return machines.

As it turns out, NVDA stock has returned the 12th highest amount to shareholders in history.

Why should you care? Because dividends and share repurchases represent direct, tangible returns of capital to shareholders. They also signal management's confidence in the company's financial health and ability to generate sustainable cash flows. And there are more stocks like that. Here is a list of the top 10 companies ranked by total capital returned to shareholders via dividends and stock repurchases.

Top 10 Stocks By Total Shareholder Return

For full ranking, visit Buybacks & Dividends Ranking

What do you notice here? The total capital returned to shareholders as a % of the current market cap appears inversely proportional to growth prospects for reinvestments. Stocks like Meta (META) and Microsoft (MSFT) are growing much faster, in a more predictable way, compared to the others, but they have returned a much lower fraction of their market cap to shareholders.

That's the flip side to high capital returns. Sure, they are attractive, but you have to ask yourself the question: Am I sacrificing growth and sound fundamentals? With that in mind, let's look at some numbers for NVDA. (see Buy or Sell NVIDIA Stock for more details)

NVIDIA Fundamentals

• Revenue Growth: 65.5% LTM and 101.8% last 3-year average.
• Cash Generation: Nearly 44.8% free cash flow margin and 60.4% operating margin LTM.
• Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for NVDA was 65.5%.
• Valuation: NVIDIA stock trades at a P/E multiple of 36.2

*LTM: Last Twelve Months

The table gives a good overview of what you get from NVDA stock, but what about the risk?

NVDA Historical Risk

Nvidia isn't immune to big drops. It fell about 68% in the Dot-Com Bubble and even more, 85%, during the Global Financial Crisis. The 2018 correction hit it by 56%, and the inflation shock in 2022 took it down 66%. Even during the Covid pandemic, the dip was still nearly 38%. Strong fundamentals don't stop sharp sell-offs when fear hits the market hard.

But the risk is not limited to major market crashes. Stocks fall even when markets are good - think events like earnings, business updates, and outlook changes. Read NVDA Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

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