By Unknown
Publication Date: 2026-10-20 09:15:00
Key Points
Nvidia’s trailing earnings multiple is at its lowest level since June 2019.
This valuation decline reflects earnings growth outpacing share price appreciation.
Concerns about AI infrastructure spending and rising competition could slow Nvidia’s growth, but not necessarily.
In early 2024, the man known as the “Dean of Valuation” viewed Nvidia (NASDAQ:NVDA) as ridiculously overpriced. New York University finance professor and author Aswath Damodaran posted on X (the social media platform formerly known as Twitter) that the stock “is a bridge too far for me.” He slashed his Nvidia position by half.
Since then, Nvidia has become the world’s largest company by market cap. Its share price has nearly tripled. You might think that the chipmaker’s valuation would be even more concerning now than it was in 2024. However, an interesting thing has happened with Nvidia along the way. Believe it or not, the stock hasn’t been this cheap in seven years — and only one explanation makes sense.
Missed AI’s “Act 1”? Act 2 Could Be 15x Bigger. Most investors think they missed the AI boat because they didn’t buy Nvidia in 2005. But according to our analysts, we’re only at the end of “Act 1″—the R&D phase. “Act 2” is the global rollout. Continue »
Image source: Nvidia. Image source: Nvidia.
Historically cheap
Nvidia’s shares currently trade at slightly above 27 times trailing 12-month earnings, according to YCharts. The last time the stock’s price-to-earnings (P/E) ratio was at that…
