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Nvidia's P/E Ratio Hits Lowest in Over a Decade, Raising Doubts on Profit Sustainability
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Nvidia's stock valuation has declined sharply, with its price-to-earnings ratio based on estimated earnings over the next 12 months falling below 17 times, the lowest level in more than a decade. This is half the level seen in 2025, when the company's revenue and profit growth were slower, and well below the over 25 times forward P/E ratio recorded in May. The divergence between Nvidia's strong fundamentals and its falling stock valuation has led CEO Jensen Huang to describe the company as 'the world's first and only growth value stock.' Speaking at a Goldman Sachs technology conference earlier this month, Huang said the company is 'severely misunderstood.' The report, published by Caixin-affiliated Cailianshe on September 22, suggests the market is questioning whether Nvidia can sustain its explosive profit growth.
Source report
September 22 (Caixin) — Nvidia's declining stock valuation is sending warning signals about the chipmaker's ability to sustain its explosive profit growth.
The company's current share price now trades at a price-to-earnings (P/E) ratio of less than 17 times its estimated earnings over the next 12 months — the lowest level in more than a decade. This marks a significant drop from:
- Half the level seen in 2025, when Nvidia's revenue and profit growth were slower.
- Well below the estimated P/E ratio of over 25 recorded in May of this year.
The disconnect between Nvidia's strong fundamentals and its stock valuation has prompted CEO Jensen Huang to describe the company as "the world's first and only growth value stock." Speaking at a Goldman Sachs technology conference earlier this month, Huang said the company is "deeply misunderstood."
Source
财联社Eastern
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Nvidia's P/E ratio falls below 17, a decade low, as market doubts profit sustainability