Nvidia Just Paid For Its Own Buyback

Nvidia just paid for its own buyback by announcing it.

This morning, Nvidia (NVDA) said it’s adding another $150 billion to its share buyback, bringing the total to $235 billion. The company called it the largest buyback authorization increase in history, and the stock jumped about 3%.

Now do the math with me. Nvidia is worth about $5.5 trillion. 1% of that is $55 billion, so a 3% move is roughly $165 billion of market value.

That’s more than the buyback itself. You just financed your entire share repurchase program by stating that you’re going to have a share repurchase program.

Even with $165 billion of Nvidia pushing it higher, the S&P 500 was still down about half a percent this morning. How is that even plausible?

It tells you how deep the selling is everywhere else. Financials are taking another hit, utilities are getting smoked, and retailers like Nike (NKE) and Lululemon (LULU) are getting cut in half. Nvidia and Apple (AAPL), about $10.6 trillion between them, are trading higher against everything else.

It’s Nvidia and Apple versus the world.

So I’m not fading this market today, as long as Nvidia holds. But understand what happens if it slips.

If the Nasdaq (QQQ) is down 250 points with Nvidia up, you’re looking at a 500-point loss if Nvidia gives it back. Nvidia is the only thing standing between you and the abyss in this market right now.