Nvidia’s price-to-earning ratio is lower than when ChatGPT was launched in 2022. The decline occurs amid a significant decline in semiconductor inventory. Nvidia’s shares have fallen 30% from the 52-week high. Melius’s research is optimistic at Nvidia ahead of next week’s meeting.
Nvidia’s closely monitored metrics have fallen to levels not seen before ChatGPT’s launch.
Nvidia’s 12-month price and return rate fell to 36.4 times on Monday, according to YCHARTS data. The decline was caused by a sharp decline in Nvidia’s stock, falling 30% on Monday from an intraday record high that reached early January.
Multiple declines in ratings make Nvidia cheaper today than when ChatGpt was first released on November 30, 2022. The stock is trading at the lowest level since August 2019.
Ben Reitzes, managing director of Melius Research, said Nvidia’s valuation dynamics also applies to the forward P/E ratio, which incorporates Wall Street’s annual revenue estimates.
According to Reitzes, the P/E ratio is 24 times, so Nvidia’s stock is 41% cheaper than when ChatGPT launched.
Merius Research
It’s an impressive feat considering Nvidia’s shares have skyrocketed by 583% since Openai released ChatGpt to the masses.
In this case, the stock price surge was backed up by profits as Nvidia’s GPU business boomed due to strong demand from AI companies. Nvidia’s net profit for 2025 rose 788% compared to 2023, which ended in January 2023.
Reitzes believes there is a rating cut, and in a memo on Monday said the risk is largely priced on semiconductor inventory like Nvidia.
“We remain very optimistic,” Wrights said.
Part of the optimism comes from Nvidia’s GPU Technology Conference next week. CEO Jensen Huang is expected to ensure that CEO Jensen Huang will continue to live out the AI boom and announce his product roadmap in 2027, according to Reitzes.
Another reason reitzes remain bullish on Nvidia is that he saw this valuation compression roll out previously in stocks in Apple, a tech stubborn man.
“The truth is, something similar happened to Apple, but when we launched the iPhone in 2008 and by the end of 2008 it went 33 times ahead of its first double on the day it had been 15 times in crisis,” Reitzes said.
“You know, the mobile trend hasn’t ended. Apple is currently trading at 31x revenues with much more revenue. When Nvidia replicates its own version of the industry’s stewardship, we can look back on this period of uncertainty and give a good laugh,” he added.
Melius Research rates Nvidia with a “buy” with a price target of $170, representing a potential rise of 60% from its current level.
