The AI chip giant's valuation has compressed after a sharp selloff, even as its latest quarter showed triple-digit revenue growth
Nvidia, the company that sells the picks and shovels of the AI gold rush, is now priced like a sleepy utility. Its forward price-to-earnings ratio has dropped to approximately 12.9x to 13x after a steep market selloff.
That puts the chipmaker below the S&P 500 as a whole. It also puts it well below Walmart, a retailer best known for low prices, not for growing revenue at triple-digit rates.
How Nvidia got this cheap
A forward P/E is a simple idea. It tells you how many dollars investors pay today for each dollar a company is expected to earn over the next year.
By early November 2026, Nvidia’s tag read roughly 13. The S&P 500’s forward multiple sat around 18.7x to 20x over the same stretch.
Walmart’s forward P/E was cited at between 36x and 40x in market discussions. So the market is currently willing to pay about three times as much for a dollar of Walmart’s future earnings as for a dollar of Nvidia’s.
The drop came fast. Nvidia hit a record close of approximately $239.24 on October 6, 2026.
By November 5, 2026, shares had slid into the $180 to $200 range. That works out to a pullback of approximately 11% to 25% from the peak, depending on where in that range you measure.
The decline erased close to $1.4 trillion in market value. Shares also fell beneath their 200-day moving average.
What spooked investors
The selloff during late October and early November was driven by two main worries. The first was the soaring cost of AI infrastructure.
The second was the prospect of regulatory challenges tied to how much power data centers consume. For a company whose biggest business is selling hardware into those data centers, both concerns hit close to home.
The irony is that the business itself has not slowed down, at least not in the most recent numbers. Nvidia reported $96.2 billion in revenue for fiscal Q2 2027, up 106% year over year.
Data-center revenue climbed 117%. Adjusted earnings per share came in at $2.22, an increase of 120%.
A growth stock priced like a value stock
A company growing revenue at 106% now carries a lower forward multiple than the broad index. The broad index includes plenty of businesses growing at a fraction of that pace.
The consensus rating on the stock remains Strong Buy heading into the next report.
What this means for investors
The next real test arrives on November 17, when Nvidia is scheduled to report earnings.
Investors will want to see whether data-center growth holds up near the 117% pace from the prior quarter. They will also be listening for any commentary on customer spending plans and on the power constraints that helped trigger the selloff.
