Highly Regarded

Is NVIDIA Corporation (NVDA) Stock Undervalued or Overvalued?

Trailing-twelve-month multiples vs Technology sector peers in our coverage

39% Discount TTM fundamentals · sector averages from covered peers

NVDA trades at 48.4× TTM earnings — a 39% discount to its Technology sector average of 78.8× in our coverage.

The Numbers

P/E (TTM)

48.4×

Sector avg: 78.8×

P/S (TTM)

25.4×

Sector avg: 17.4×

Market Cap

$4.75T

EPS (TTM): $4.04

Revenue (TTM)

$187.14B

Net income: $99.20B

Technology Peer Comparison

How NVDA's multiples stack up against sector peers we cover. Click any peer for its own valuation breakdown.

Stock Price P/E (TTM)
NVDA This page $195.52 48.4×
AAPL $312.73 39.6×
MSFT $386.79 24.2×
AVGO $373.72 78.3×
AMD $551.70 208.2×
INTC $122.14 —
CSCO $113.98 44.0×
ORCL $143.82 33.3×
PLTR $132.53 308.2×
TXN $303.53 55.7×
QCOM $186.38 37.7×
CRM $165.63 24.0×
ADBE $218.11 13.1×

Is the Discount Justified?

July 6, 2026

NVIDIA's P/E multiple of 48.6x, while substantial, is at a discount to the Technology sector average of 76.3x. This valuation dynamic can be understood in light of NVIDIA's exceptional growth trajectory, particularly within its Data Center segment, which saw a 92% year-over-year revenue increase in Q1 fiscal 2027. The company reported record overall revenue of $81.6 billion, up 85% from a year ago, and beat EPS estimates. Future earnings are projected to grow significantly, with a 34.29% increase expected next year. The robust demand for its AI chips and the adoption of its Blackwell architecture are strong justifications for a premium valuation. The sector average may be influenced by a broader range of companies, some with even higher multiples, making NVIDIA's multiple appear relatively lower despite its strong performance.

Sources

Frequently Asked Questions

Is NVDA overvalued or undervalued?
On trailing-twelve-month earnings, NVDA trades at 48.4x versus a Technology sector average of 78.8x in our coverage — a 38.5% discount. Whether that's justified depends on growth, margins, and risk; see the context above.
What does the P/E ratio tell you?
Price-to-earnings compares a company's share price with its per-share profits. A higher multiple means investors pay more per dollar of earnings — often for faster expected growth — while a lower one can signal slower growth or higher perceived risk.
Why compare against the sector average?
Valuation multiples vary structurally between industries — software typically trades richer than banks or energy. Comparing NVDA with its own Technology peers is more informative than comparing against the whole market.
Is a cheap stock automatically a good buy?
No. A discount can be justified by weak growth or elevated risk (a "value trap"), and a premium can be earned by quality and consistency. Valuation is one input — pair it with the fundamentals and the AI context on this page.

Methodology

Multiples are computed from trailing-twelve-month fundamentals (from company filings) and the latest share price: P/E is price ÷ diluted EPS, and P/S is market cap ÷ revenue. Sector averages use the Technology names in our 50-stock coverage with positive earnings — a deliberately like-for-like, if imperfect, benchmark.

Stocks with negative trailing earnings are compared on price-to-sales instead. Multiples update with prices and fundamentals; AI context refreshes weekly.

Not Financial Advice

This page is for education and information only. Indicators are mechanical calculations, AI commentary can contain errors, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a qualified financial advisor. See our full disclaimer.

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