Nvidia Stock Hits Cheapest Valuation Since 2019 After $1 Trillion Wipeout, But AI Chips Rally Looms

After a $1 trillion wipeout, is Nvidia ready for a comeback? - Nvidia's $1 trillion slide makes stock cheapest since AI boom

After a $1 trillion wipeout, is Nvidia ready for a comeback? 1/7 Nvidia's $1 trillion slide makes stock cheapest since AI boom Nvidia has lost nearly $1 trillion in market value in less than two months as investors reassess AI-related stocks. Despite the steep correction, the company continues to report record revenue growth. The sell-off has pushed Nvidia's valuation to its lowest level since before the AI boom began, with investors rotating towards other semiconductor stocks amid concerns over future growth. (Sources: Yahoo Finance, TradingView) 2/7 Valuation falls to multi-year low The recent decline has driven Nvidia's forward price-to-earnings (P/E) multiple to a multi-year low. Analysts note that the stock is now trading at a significant discount to its historical valuation, reflecting concerns over increasing competition and the pace of AI infrastructure spending rather than any major deterioration in the company's financial performance. 3/7 Business fundamentals remain strong Despite the sharp drop in its share price, Nvidia continues to deliver record revenue, supported by robust demand for its AI chips. The company maintains industry-leading profit margins, while analysts expect its next-generation AI platforms, including Rubin, to drive another phase of earnings growth. Its strong product ecosystem and pricing power remain key strengths. 4/7 Why investors have turned cautious Investor sentiment has weakened as major cloud companies increasingly develop their own custom AI chips, raising questions about Nvidia's future market share. At the same time, concerns over rising memory costs and stronger competition from rivals such as AMD and Intel have added to the uncertainty surrounding the company's long-term growth outlook. 5/7 Analysts continue to see opportunity Several Wall Street analysts believe the recent correction has created an attractive entry point for long-term investors. Some brokerages have upgraded the stock to a Buy, arguing that the market has become overly pessimistic. They believe Nvidia's current valuation already factors in many of the risks, while the company's AI leadership remains intact. 6/7 Technical indicators show signs of recovery Technical analysts say Nvidia has reached an important support level and is beginning to form a bullish chart pattern. The combination of a cheaper valuation and improving technical signals has strengthened the case for a potential rebound if overall market sentiment towards AI stocks improves. 7/7 Key triggers to watch Investors will closely monitor Nvidia's upcoming earnings for evidence that AI demand remains resilient. The rollout of its next-generation Rubin platform, developments in custom AI chips from large cloud providers, and the company's ability to maintain strong margins amid rising competition are expected to be the key factors influencing the stock's next move.

Bank of America Sees Nvidia Vera CPU Sales Reaching $20 Billion

Nvidia (NVDA) stock investors have been fed a familiar playbook. More robust accelerators, higher rack prices, and another wave of hyperscaler spending were expected to propel Nvidia stock's valuation to even more stratospheric levels. Bank of America's latest semiconductor outlook, shared with me, offers an interesting twist on that view. The bank's analysts, led by veteran tech analyst Vivek Arya, argue that a rapidly emerging AI workload is driving demand in an area investors have largely overlooked. It sits beside Nvidia's relentless GPU franchise but opens the door for a new revenue pool as companies move from training chatbots to deploying autonomous agents at scale. The note also comes at a time when Nvidia stock investors are looking for new evidence to keep the stock's remarkable rally alive and propel it into a meaningful next leg higher. At the time of writing, Seeking Alpha data show Nvidia in the red over the past month, despite posting a 9% gain year to date. Despite being relatively strong, those gains pale in comparison with what Nvidia delivered in 2024 and 2025, when the stock returned 171% and 39%, respectively, according to SlickCharts. BofA's note, however, raises the question of whether investors are still valuing Nvidia as merely a chip leader as it becomes something much larger. Bank of America sees a $20 billion opening Nvidia's (NVDA) primary AI bottleneck has predominantly been GPUs. However, as companies move from chatbots to agentic AI, the pressures are shifting toward CPUs instead. For context, according to Nvidia's latest CFO commentary on Q1 sales, Data Center compute revenue, led by its Blackwell GPUs, reached $60.4 billion, accounting for roughly 74% of the company's $81.6 billion in quarterly sales. Though that remains critical and will continue to be so for Nvidia, BofA has identified a massive new opportunity for Nvidia's Vera CPU. BofA says Nvidia expects about $20 billion in Vera CPU sales during the second half of fiscal 2027. Roughly 50% of that could come from CPUs supporting GPU systems, while the rest may come from standalone CPU racks built for agentic AI and reinforcement-learning workloads. The scale is amazing. Nvidia might ship 4 million to 5 million Vera CPUs in the first two quarters after launch, compared with 2.5 million Grace CPUs shipped to date. Additionally, Vera could carry an average selling price of roughly $4,000 to $5,000 per chip. Zooming out, the larger opportunity is far more striking. According to Reuters, Nvidia frames the agentic-AI CPU market at about $200 billion, and that estimate excludes traditional general-purpose server workloads. To understand the role of CPUs in agentic AI, think of them like project managers. They coordinate tools, memory, databases, operating systems, and step-by-step decisions, while GPUs handle the complicated AI calculations. For investors, that points to a provocative possibility: CPU unit demand may eventually exceed GPU demand as processors appear in both accelerator racks and separate agentic AI systems. Nvidia wants to own more of every AI system Nvidia is looking to cast a much wider net across the AI ecosystem by capturing a larger share of the infrastructure surrounding its GPUs. BofA estimates Nvidia's content per gigawatt could rise from roughly $40 billion with Blackwell Ultra to $60 billion to $80 billion with Rubin and Rubin Ultra, and potentially approach $100 billion with Feynman. Nvidia is packing CPUs, networking, storage, interconnects, and additional racks around its core accelerators, expanding its larger revenue opportunity in the process. That also opens the door for more competition, though. AMD is pushing higher-core-count CPUs and rack-scale systems. Intel is defending its server franchise while betting on foundry progress. Arm-based designs are gaining market share, while Amazon, Google, and Microsoft continue to develop custom processors optimized for their own workloads. Though Nvidia's full-stack advantage remains elusive, there are pricing pressures, market share fluctuations, and bigger customer bargaining power, which are major issues. Hyperscalers also have an incentive to limit their dependence on one supplier. For Nvidia stock investors, that adds a new layer to its already illustrious growth story. For instance, in late May, HSBC raised its Nvidia price target to $325 from $295 and said that the established GPU roadmap may no longer be sufficient on its own to trigger a major re-rating, Investing.com noted. But new markets, such as agentic-AI server CPUs, could become the next valuation narrative. Bank of America says Nvidia still looks unusually cheap Amid the recent sell-off, BofA analysts are bullish on Nvidia stock, maintaining a buy rating and a $350 price target while naming it a top AI pick. BofA estimates the shares trade at nearly 16 times calendar 2027 earnings, despite Nvidia's growing reach across GPUs, CPUs, networking, storage, and entire AI systems. Additionally, the bank also values Nvidia at nearly 0.4 times its price-to-earnings-growth ratio, behind the Magnificent 7 average of approximately 1.9 times. In essence, the argument is that investors are still underestimating the durability of Nvidia's tremendous earnings growth. However, the risks are obvious, too. Despite being attractively valued according to BofA analysts, Nvidia has little room to disappoint. If we see any sluggishness in AI spending, competitive pressure, or weaker system adoption, the valuation case could quickly be challenged. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published July 14, 2026 at 7:47 PM.

Morgan Stanley says Nvidia stock remains top pick despite headwind

Nvidia (NVDA) stock has struggled to keep pace with the broader semiconductor rally this year, but Morgan Stanley just says the AI chip giant remains one of its favorite names. Shares of Nvidia fell 3.5% on Monday as investors continued to question whether the chipmaker can sustain its growth. Through July 13's close, Nvidia was up 9.1% year to date, well behind the Philadelphia Semiconductor Index's 72.2% gain over the same period. The muted stock performance comes even as Nvidia's biggest customers continue to ramp up AI spending. On Monday, Meta Platforms (META) said it would increase spending on its Louisiana AI data center to more than $50 billion. Meta, along with companies such as Microsoft (MSFT), Amazon (AMZN), and Alphabet (GOOGL), remains one of Nvidia's largest buyers of AI chips. Since generative AI took off in 2023, Nvidia has dominated the AI accelerator market. Its GPUs power large-language-model training and inference workloads, helping Nvidia become the world's most valuable publicly traded company. Still, investors have become increasingly cautious. Hyperscale cloud providers are developing their own custom AI chips, while many on Wall Street continue to question whether hundreds of billions of dollars in AI infrastructure spending will ultimately generate attractive returns. Wall Street, however, remains overwhelmingly bullish. According to TipRanks, 37 analysts covering Nvidia have an average 12-month price target of $309.33, implying roughly 52% upside from recent levels. Getty Images Nvidia earnings show AI demand remains strong Nvidia's latest results continued to support the AI investment thesis. For the fiscal first quarter ended April 26, Nvidia reported non-GAAP earnings of $1.87 per share, beating Wall Street's estimates of $1.76. Revenue came at $81.6 billion, up 85% from a year earlier. The chipmaker also reported record Data Center revenue of $75.2 billion, up 92% year over year. "The buildout of AI factories - the largest infrastructure expansion in human history - is accelerating at extraordinary speed," said Nvidia CEO Jensen Huangin a statement. "Nvidia is uniquely positioned at the center of this transformation as the only platform that runs in every cloud, powers every frontier and open source model, and scales everywhere AI is produced." Nvidia's upcoming Q2 FY2027 earnings report is scheduled to be released in August. The company expects fiscal second-quarter revenue of $91 billion, plus or minus 2%, assuming no data center compute revenue from China. It also forecasts an adjusted gross margin of 75% and adjusted operating expenses of about $8.3 billion. Morgan Stanley says Nvidia's growth story is getting broader After hosting investor meetings with Nvidia's management, Morgan Stanley reiterated its overweight rating and a $288 price target, according to a recent research note sent to TheStreet. Nvidia remains the firm's top semiconductor pick. Morgan Stanley said Nvidia management described "accelerating growth rates" even as revenue approaches "$100 bn per quarter." Rather than relying solely on hyperscale cloud providers, Morgan Stanley said Nvidia is seeing growth from three major customer groups: AI labs, hyperscalers, and enterprise, industrial and sovereign AI customers. The bank noted that AI labs currently represent about 20% of Nvidia's demand. It also said Nvidia's exposure to one leading frontier AI model has increased from minimal levels to "close to 50%", while other frontier models continue to be built primarily on Nvidia hardware. Morgan Stanley also dismissed concerns that custom AI chips will significantly erode Nvidia's market share. "We continue to believe that two things can be true at once: hyperscalers will develop and deploy custom silicon alternatives (ASICs), while Nvidia will retain a very large portion of the business," the analysts wrote. The firm said its industry contacts support management's argument that "the lowest cost per token is quite frequently from Nvidia," adding that cheaper custom silicon "does not drive better token economics." "With both Nvidia's and Broadcom's AI businesses expected to grow more than 80% next year while remaining supply constrained, we don't see a dramatic shift going forward and remain enthusiastic about growth in both categories," Morgan Stanley said. The bank also highlighted accelerating demand from sovereign AI projects, enterprise customers and neocloud providers, saying power constraints, reshoring efforts and geopolitical considerations are creating a new wave of AI infrastructure investment. Management described that opportunity as fragmented today but one that could reach "substantial scale when the time comes." Morgan Stanley also said Nvidia pushed back on recent reports that Rubin Ultra could be delayed until 2028, telling investors "Rubin Ultra will ship next year." While management acknowledged changes to the rack design, it characterized them as improvements rather than delays. Although Nvidia's size could limit further multiple expansion, Morgan Stanley said it now views the company as "the best value in the group." "The stock has risen but underperformed many peers. However, our conviction remains high. We previously rotated our top pick to Sandisk and later Micron because those names offered greater leverage to parts of the AI supply chain, but we now believe Nvidia offers the best value in the group," Morgan Stanley said. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published July 14, 2026 at 12:13 PM.

Nvidia stock valuation falls to lowest level since 2019

Nvidia (NVDA) investors had been bracing for a tougher AI trade, but perhaps not this kind of reset. Over the past three years or so, Wall Street has treated Nvidia as the cleanest way to own the AI buildout. For perspective, Nvidia's current market cap is at an eye-popping $4.98 trillion, up from roughly $422 billion on Nov. 30, 2022, the day OpenAI introduced ChatGPT, according to StatMuse. Hence, Nvidia's market value has risen by nearly 1,080%, or roughly 11.8x, since ChatGPT's release. However, even after a monumental run, the expectation was that demand for GPUs, data-center chips, and next-generation AI systems would likely keep the stock mostly insulated from a deeper multiple squeeze. Case in point: Seeking Alpha still shows Nvidia stock delivering a 24% one-year gain, but that nevertheless marks a dramatic slowdown from the early days of the AI LLM frenzy. That assumption is now being tested. Nvidia has pulled back sharply from its May high, and the stock's valuation is sending a message that looks remarkably different from the one investors saw during the AI boom. The tech giant's growth story remains intact, but the market is no longer pricing it like the obvious winner. Ian Maule/Bloomberg via Getty Images The valuation signal Nvidia investors cannot ignore Nvidia's selloff has effectively pushed the stock into a valuation zone investors haven't seen since before the AI boom changed the company's entire earnings profile. According to a Bloomberg analysis cited by Seeking Alpha, Nvidia trades at about 18 times projected earnings over the next 12 months, its cheapest forward valuation since early 2019. Though it's expected to continue growing at a robust pace, it now trades at a forward multiple lower than the S&P 500's more than 20 times and the Nasdaq 100's nearly 23 times earnings. For context, a P/E ratio shows how much investors pay per dollar of a company's profit. A forward P/E uses expected future profit instead of past earnings. It's basically like paying rent for an apartment based on what you expect the neighborhood to become next year. Nvidia stock has tanked about 16% from its May 14 record, wiping out $1 trillion in market value, while investors rotated into other semiconductor names. Memory stocks like Micron were the clearest beneficiaries, with shares up over 232% in 2026, according to Seeking Alpha. Additionally, Advanced Micro Devices and Intel have also dramatically outpaced Nvidia this year. So even though Nvidia remains critical to AI infrastructure, the market is no longer paying a clear leadership premium for that position. Wall Street price targets for Nvidia stock * Bank of America: $350. Vivek Arya reiterated a Buy rating, arguing that Nvidia's lagging performance creates an "enhanced" buying opportunity. * Goldman Sachs: $285. James Schneider kept Buy, saying valuation already reflects market-share fears and still implies strong AI growth. * Morgan Stanley: $288. Joseph Moore kept Nvidia at overweight, with MarketBeat showing a modest target lift from $285. * JPMorgan: $280. Harlan Sur maintained an overweight rating after raising his target to $265. * UBS: $280. Timothy Arcuri kept Buy, with MarketBeat showing a target increase from $275. Sources: MarketWatch, Barron's, MarketBeat, AOL, 9XMarkets. Why Nvidia's rebound still needs confirmation According to data from Barchart, Nvidia stock is currently trading near $204, keeping its chart in a mixed but improving position. The stock is above its 5-day moving average of $197.80, its 100-day average of $197.27, and its 200-day average of $191.40, indicating that buyers have defended the longer-term trend. However, the issue remains in the middle of the chart. Nvidia is still below its 50-day moving average of $209.52, which is perhaps the first major resistance level. A clean move above $209 to $210 would suggest the rebound is much more durable. Until we see that, though, the stock is bouncing rather than fully breaking out. On the downside, the first area to watch is around $201 to $202, near the 20-day moving average. Below that, $197 to $198 becomes a more important support zone, as it lines up with both short-term and 100-day trend levels. A deeper break might put the 200-day average near $191 back in focus. Momentum is not overheated. Relative strength readings sit around 50-55, indicating balance, but volatility remains high, with the 14-day average true range near $7.13, or about 3.5%. Nvidia's chart has stabilized, but the stock needs to reclaim the $210 area before the technical picture turns bullish. What has to happen next for Nvidia's premium to return For Nvidia stock to regain its lofty highs, it needs a lot more than "AI demand is strong." The next several results will require proof that AI spending can continue converting into earnings without being crushed by higher rates, capex fatigue, or a rotation into cheaper chip stock names. The last earnings report still gave bulls plenty to work with. Nvidia reported record Q1 fiscal 2027 revenue of $81.6 billion, up 85% from a year earlier, spearheaded by Data Center revenue of $75.2 billion, showing the core AI engine hasn't broken. The AI poster child has blown past estimates on both lines by handsome margins in each of the four previous quarters. Nevertheless, that bar has now moved higher. According to Seeking Alpha, Nvidia's next report is expected Aug. 19 post-market, with consensus EPS of $2.08 and revenue of $91.73 billion. The key detail is the revision balance: analysts have 34 upward EPS revisions and 3 downward revisions over the past 90 days. That means a lot is riding on the next quarter, which has to do two things at once: confirm the growth curve while restoring confidence in its valuation. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published July 9, 2026 at 4:17 PM.