With just over a month to go in 2017, NVIDIA (NVDA 216.14, +1.21) is looking to finish the year with a gain of more than 100.0%. This puts the chipmaker behind only four other components of the S&P 500, as the stock continues defying calls for a correction.
While NVIDIA is looking to record an eye-popping gain for the year, the advance pales in comparison to the stock's 2016 charge, when it surged more than 220.0%, ending the year ahead of the remaining members of the S&P 500.
The narrative around NVIDIA remains largely the same, albeit with a richer valuation. The company's video cards (GPUs) are still considered best in class, even though the GTX1000 series was released more than a year ago. NVIDIA's only competitor in the arena—AMD (AMD 11.39, +0.02)—recently released its Vega series cards, which have significantly narrowed the performance gap to NVIDIA's line of GPUs. However, AMDs latest generation of GPUs came roughly a year after NVIDIA's, meaning NVIDIA is likely closer to upping the ante once again. That said, the performance leap in the GTX1000 series was so large that NVIDIA essentially bought itself more time to develop Volta-based GPUs that are likely to sell under a GTX1100 series label. Industry insiders have speculated that NVIDIA may unveil its next line of GPUs in early 2018.
While NVIDIA has maintained its technical edge, the stock's breathless run over the past couple years has made it susceptible to a pullback if questions about demand for NVIDIA's products begin cropping up. As of now, the company appears to be enjoying strong demand from gamers while the continued rise in bitcoin has contributed to demand for GPUs for mining purposes. In addition, NVIDIA has partnered with several carmakers to develop an autonomous driving system. These markets deserve to be watched in 2018 for possible signs of sapping demand that could weigh on the high-flying stock.