Nvidia’s earnings have grown so fast they outpaced a rising stock price, pushing its valuation to a level not seen in over a decade. Whether that signals a rare buying opportunity or a quiet warning from the market is the…
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NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) now trades at about 17 times expected earnings for the next twelve months, its lowest forward multiple since January 2015 and well below a 15-year average of 30x. A multiple that low usually follows a crash, yet the stock rose 1.68% in the September 28, 2026 session to $228.86, about 3% below its fifty-two-week high of $236.54.
Shares are up 23% year to date and 28.74% over one year. The price climbed while the multiple fell, which means earnings forecasts rose faster than the stock, an unusual setup for a company valued at $5.53 trillion.
How Earnings Outran a Rising Stock
A forward P/E is the share price divided by expected earnings per share, so it falls when earnings grow faster than the price. NVIDIA’s fiscal year ends in late January, so its quarter labels run ahead of the calendar.
Nvidia reported revenue of $57 billion, up 62%, on November 19, 2025, then $68 billion, up 73%, on February 25, 2026. Jensen Huang said, “Demand has gone parabolic,” as revenue reached about $82 billion on May 20, 2026, growth Nvidia put at 85%.
Nvidia then posted $96.2 billion, up 106%, on August 26, 2026. Analysts raised the average fiscal 2028 EPS estimate to $15.6826 from $12.6737 90 days earlier.
Low valuations can also signal doubt.
A shrinking multiple on a rising stock can also mean investors are marking down how long the growth lasts. The fiscal 2028 EPS range runs from $9.80 to $18.746, which shows how little agreement exists.
Management guided to roughly 70% revenue growth in fiscal 2028. Cheap against history only matters if the history repeats.
Capital Budgets Set the Ceiling
NVIDIA’s revenue is someone else’s capital spending. Wells Fargo strategist Ohsung Kwon argues the math fails if the market expects AI capex of about $1 trillion in 2028, while NVIDIA cited top-five hyperscaler capex of nearly $800 billion in 2026 and $1.3 trillion in 2027. That expansion must be powered, cooled, and connected by someone other than the chipmaker, which is why we pulled seven of those suppliers into a free AI infrastructure report.
The company expects rising memory costs to push gross margins to a bottom of 71% to 72% in the fiscal fourth quarter, and its outlook assumes no China data center compute revenue.
Jensen Huang said the $150 billion buyback increase “reflects our confidence in the long-term opportunity ahead,” a signal that management sees its own multiple as too low.
Should You Buy or Sell NVDA Stock
I believe NVIDIA looks undervalued at $228.86. Even the most pessimistic figures put NVDA stock far cheaper than the 30x historical multiple, and Nvidia guided to $108 billion for the quarter in progress.
Capex budgets can level off, but a supply-constrained outlook and steady upward revisions suggest the market is pricing in more caution than the fundamentals show. The average price target is $327.70 across 61 analysts.
The test is Nvidia’s next report, expected November 17, 2026, though the company has not yet confirmed it. If fiscal fourth-quarter revenue guidance lands below the $124.37 billion consensus, or the margin floor slips below 71%, skeptics have the stronger case, and the low multiple becomes a fair price for slowing growth. But for now, NVDA stock remains a buy.
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