Motley Fool Money Nvidia’s Big Number
19 snips
May 29, 2025 
Tim Beyers, an investment analyst at The Motley Fool, delves into Nvidia's remarkable $24 billion in free cash flow for the quarter. He discusses the potential for Nvidia to be trading at a favorable price if this growth continues. The conversation touches on trade relief regarding Trump’s policies and its effects on the semiconductor supply chain. Beyers also critiques Nvidia's minimal dividend despite its strong cash position and examines the challenges posed by U.S. export controls to China, highlighting the market's importance and strategic implications.
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Nvidia's Massive Free Cash Flow
- Nvidia's $24 billion free cash flow this quarter could scale to $96 billion annually, near a 3% forward free cash flow yield.
- This yield compares reasonably well to the S&P 500 average of 3.3%, suggesting Nvidia may be fairly valued if growth continues.
Nvidia's Minimal Dividend Critique
- Nvidia pays a tiny dividend of one cent per quarter, which Tim Beyers finds unnecessary and symbolic at best.
- He argues the company should either pay a meaningful dividend or reinvest fully to maximize shareholder returns.
Impact of H20 Chips Export Ban
- Nvidia incurred a $4.5 billion charge from unsellable H20 chips restricted from China due to export controls.
- Despite this, demand globally remains strong, so the write-down may be mostly immaterial if some chips find alternative buyers.