Nvidia (NVDA) shares have moved modestly in recent weeks, trending up about 2% over the past month. The company’s stock activity continues to capture investor attention given its strong long-term gains and evolving market position.
See our latest analysis for NVIDIA.
Momentum around Nvidia’s share price has slowed briefly, but the bigger story remains its exceptional long-term performance, including a 34.9% year-to-date share price return and an astonishing 1,064.9% total shareholder return over the past three years. As the market digests recent strength, investors appear to be weighing both continued growth potential and evolving risk perceptions.
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With shares up sharply over the past several years, investors are now wondering if Nvidia is still undervalued given its future potential, or if all the good news is already reflected in the current price.
Most Popular Narrative: 20.6% Undervalued
According to restinglion, NVIDIA’s last close price of $186.60 sits well below a calculated fair value of $235. This sets the stage for a compelling argument focused on NVIDIA’s long-term dominance and ongoing growth strategy.
Most stockholders don’t understand how NVIDIA makes its money. Not only is NVIDIA an AI chip company, NVIDIA sells their top tier software with their hardware called CUDA. CUDA is the software all companies are turning to due to its advanced integration with AI and its end-to-end software stack. This software is sold on a subscription basis, generating high earnings even after the sale of their chips. Thus, NVIDIA has positioned themselves in a way to dominate the future of AI, and with their high earnings, they will be able to continue to invest a high amount of their funds into innovation to maintain their lead over the global AI market.
Read the complete narrative.
Curious about the narrative’s ambitious valuation? There is a bold forecast built on margin strength, future recurring revenue, and a growth blueprint rivaling industry legends. Want to see which assumptions could power NVIDIA’s next leap? The full story goes far deeper. Get the details that set this fair value apart.
Result: Fair Value of $235 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, slowing revenue growth or unexpected shifts in AI demand could challenge Nvidia’s current valuation and the bullish outlook presented above.
Find out about the key risks to this NVIDIA narrative.
Another View: Market Multiples Raise Caution
Taking a look from another angle, Nvidia’s price-to-earnings ratio of 52.4 is much higher than the US Semiconductor industry average of 34.4, signaling a premium. In comparison, its peer average is 68.8 and a fair ratio is 65.9. The current valuation could be at risk if growth slows. Should investors be wary of this premium, or is it justified by Nvidia’s unique market position?
See what the numbers say about this price — find out in our valuation breakdown.
NasdaqGS:NVDA PE Ratio as at Nov 2025
Build Your Own NVIDIA Narrative
If these perspectives don’t quite match your own, or you’d rather dive into the numbers yourself, you can build your personalized NVIDIA narrative in just a few minutes. Do it your way.
A great starting point for your NVIDIA research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.
Valuation is complex, but we’re here to simplify it.
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