Wall Street expects Nvidia to deliver $4.02 in earnings per share during fiscal 2026, which places its stock at a forward P/E ratio of just 28.7. From that perspective, it actually looks quite cheap!

U.S. shares are already more expensive than they were back when interest rates were stuck at zero, leaving little room for outperformance as the fed-funds rate comes down. Meanwhile, corporate profit margins look unsustainably high.

The high-flying AI chip superstar seemed to run out of gas in the fiscal 2025 second-quarter earnings report it released on Aug. 28. While the company beat estimates on the top and bottom lines, the differences were narrower than investors were used to, and guidance was also less impressive than some had hoped.