BTC-0.63%
Market Analysis
Nvidia Set to Replace Intel in Dow Jones Industrial Average; INTC Down 50%+ in 2024
Nvidia is set to replace Intel in the Dow Jones Industrial Average, highlighting a shift in the semiconductor industry as Intel struggles with declining performance.
Editorial disclosureRead more
All reviews, research, news and assessments of any kind on The Tokenist are compiled using a strict editorial review process by our editorial team. Neither our writers nor our editors receive direct compensation of any kind to publish information on tokenist.com. Our company, Tokenist Media LLC, is community supported and may receive a small commission when you purchase products or services through links on our website. Click here for a full list of our partners and an in-depth explanation on how we get paid.
In a significant reshuffling of the Dow Jones Industrial Average (DJI), Nvidia (NASDAQ: NVDA) is set to replace Intel (NASDAQ: INTC) after a notable 25-year run on the index. This transition, announced by S&P Dow Jones Indices, also sees Sherwin-Williams (NYSE: SHW) taking the place of Dow (NYSE: DOW).
The changes underscore a major shift in the semiconductor market, spotlighting Nvidia’s burgeoning influence in the industry today after a period of massive, aggressive growth in its market cap and revenue. Intel’s removal from the Dow comes amid a challenging period for the company, now seemingly a shell of what it once was.
At the time of writing (4:47 AM EST), Intel’s stock is trading down 2.76% over the premarket trading session while Nvidia’s stock has gained 2.50%.
Intel Out of DJI, Nvidia to Replace the Company in the Index
Once a leader in chip manufacturing, Intel has struggled to maintain its competitive edge, losing ground to rivals like TSMC and missing the AI technology wave that has surged in recent years. With its shares plummeting by 54% this year, Intel has become the Dow’s worst performer. This downturn is compounded by a significant drop in revenue, with projections indicating the company may report its first annual net loss since 1986, a stark indicator of its ongoing struggles.
For Intel, the implications of being ousted from the Dow Jones are profound. Beyond the symbolic blow to its reputation, Intel faces tangible financial repercussions.
Intel’s exclusion from exchange-traded funds (ETFs) that track the index could exert further downward pressure on its stock price. As Intel navigates a painful transformation, it grapples with a loss of investor confidence, reflected in its deteriorating financial metrics and sharply declined market valuation.
Nvidia Continues to Grow After 10-for-1 Stock Split
Conversely, Nvidia’s induction into the Dow Jones marks a significant milestone in its ascension as a tech powerhouse. Known for its leadership in AI technologies, Nvidia’s stock has become a critical indicator of the AI market’s health. The company’s recent 10-for-one stock split has broadened its appeal to retail investors, further bolstering its visibility and market presence.
With a market valuation soaring to $3.32 trillion, Nvidia stands as the world’s second-most valuable company, underscoring its dominance in the semiconductor sector.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
