Nvidia Trades at Decade-Low Valuation Despite Doubled Revenue

Nvidia (NVDA) stock is trading at less than 17 times expected forward 12-month earnings — the cheapest valuation the shares have commanded in more than a decade and roughly half the multiple investors were willing to pay as recently as early 2025, according to Barchart.

The de-rating has occurred against a backdrop of accelerating, not decelerating, fundamentals. That paradox sits at the heart of the debate over whether NVDA's compressed multiple signals heightened risk or a rare value buying opportunity.

The disconnect between Nvidia's soaring earnings power and its shrinking valuation multiple suggests the market is pricing in meaningful skepticism about the sustainability of the current AI spending cycle.

The fundamental case

The numbers remain extraordinary. Fiscal second-quarter revenue more than doubled year over year to $96.2 billion, with data center revenue surging 117% to $89 billion. Management has guided for approximately $108 billion in third-quarter revenue, implying 89% growth.

CEO Jensen Huang has projected that chip sales could double in calendar year 2027. CFO Colette Kress guided for 70% revenue growth in fiscal 2028 — a figure that far exceeded the 45% Wall Street had previously modeled. Barchart notes there has never been a company of Nvidia's scale growing at anything close to this rate.

What's behind the discount

Several legitimate risks explain the market's caution. Nvidia is financing a growing share of its sales to AI startups, with roughly 25% of fiscal 2028 revenue expected to come from customers receiving some form of company-backed financing — potentially $175 billion funded off its own balance sheet.

Other tangible headwinds include calls from leading AI labs, including Anthropic and OpenAI, to slow frontier development. Community backlash against data center construction is rising. Soaring interest rates pressure hyperscaler capital budgets. And Nvidia faces complete exclusion from the Chinese data center market.

Additionally, off-balance-sheet guarantees exceeding $100 billion tied to projects like the SB Energy campus for OpenAI introduce credit risk that traditional valuation metrics do not capture.

The verdict

Barchart argues the risks are real but concludes this looks like a can't-miss buy opportunity for NVDA. The central question for investors is whether Nvidia's vendor-financing exposure and off-balance-sheet commitments prove manageable as the AI spending cycle matures — or whether the decade-low multiple was the market's early warning.