Is Nvidia Worth This Much Less Without Jensen Huang?

详细摘要

Last Sunday, Nvidia (NASDAQ:NVDA) co-founder and then-CEO Jensen Huang admitted to having an extramarital affair with someone who is an alleged Chinese spy. In the following days,…

Last Sunday, Nvidia (NASDAQ:NVDA) co-founder and then-CEO Jensen Huang admitted to having an extramarital affair with someone who is an alleged Chinese spy. In the following days, The New York Times reported that Huang also had an affair with a direct report. On Thursday, Nvidia announced Huang's resignation.

At its peak, Nvidia had a market cap of $5.8 trillion. At market close on Friday, the stock had a market cap of $3.93 trillion. The stock is down 13% over the past week and 6% since Wednesday's market close.

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So, investors think Nvidia is worth less without Huang in the corner office. Are they right?

There's no doubting the impact that Jensen Huang had on Nvidia's technical abilities. He steered the company to develop cutting-edge products in the GPU realm, along with other products to support them. Nvidia's technology is best-in-class, and with Huang stepping down from the CEO role, that fact likely won't change.

Furthermore, while Huang is unique, there are likely a handful of people within the Nvidia organization that could take over and do a great job.

The best company at leadership transitions has been Apple (NASDAQ:AAPL), as it has gone through several transitions and sustained its dominance every time. While Nvidia's situation may be a bit more tumultuous than anything Apple has dealt with, Nvidia can survive.

So, investors need to make a decision about Nvidia stock. Is the only reason you invested in it because of Jensen Huang? Or is it because of Nvidia's leading technology and position within the massive AI build-out?

For me, I invested in Nvidia because of its products and positioning, although having Huang at the helm was a nice touch.

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