Nvidia has quietly slipped into a valuation zone that almost never shows up on long-term charts - and some Wall Street analysts believe the market is missing what that really means.
After months of debate around AI spending, GPU demand, and capital intensity, the stock now trades at levels that Bernstein says have historically marked rare buying opportunities rather than warning signs.
Key Takeaways
Nvidia is trading at a valuation level it has rarely reached over the past decade, according to Bernstein.
The recent pullback appears driven by investor sentiment and AI spending concerns, not weakening fundamentals.
Multiple analysts see the current setup as an attractive long-term entry point despite short-term volatility. s
Bernstein’s latest analysis points out that Nvidia is currently priced at around 25 times forward earnings. In isolation, that number may not look extraordinary. In Nvidia’s case, however, it places the stock in the bottom decile of its valuation range over the past ten years.
Even more striking is how Nvidia looks relative to its peers. The stock is trading at roughly a 13% discount to the PHLX Semiconductor Sector Index, a situation Bernstein says has occurred on only a handful of trading days across an entire decade. For a company that typically commands a premium, that discount stands out.
Bernstein analyst Stacy Rasgon summed it up bluntly: a 25 forward multiple may feel expensive for an average stock, but Nvidia does not operate in average conditions.
Strong Results, Shaky Confidence
The valuation compression has not come from weak performance. Nvidia shares are still up roughly 34% in 2025, well ahead of the S&P 500, which has gained about half that. The disconnect appears elsewhere – sentiment.
Over the past month, Nvidia has pulled back by around 7% as investors grew uneasy about the scale of AI-related spending and questioned whether GPU demand can remain as intense as it has been. Those concerns have overshadowed the company’s earnings, which have continued to come in above expectations.
In other words, the stock is being priced for doubt, not deterioration.
Bernstein’s Bet: History Over Headlines
Bernstein argues that this kind of setup has historically favored long-term buyers. The firm reiterated its outperform rating and held firm on a $275 price target, emphasizing that previous periods when Nvidia traded at similar valuation levels were followed by strong multi-year performance.
Rasgon acknowledged the current wave of AI anxiety but stressed that Nvidia’s position going into the new year remains structurally strong. From Bernstein’s perspective, today’s pricing reflects fear of what might slow down, rather than evidence that it already has.
Strategy Still Moving Forward
While markets debate demand curves, Nvidia continues to reinforce its position behind the scenes. U.S. antitrust regulators recently cleared the company’s $5 billion investment in Intel, a move that strengthens capacity and strategic alignment in an increasingly competitive chip landscape.
The deal signals that Nvidia CEO Jensen Huang is not retreating in response to uncertainty, but doubling down on partnerships and scale to protect long-term leadership in AI hardware.
Bullish Voices Get Louder
Bernstein is not alone. Tigress Financial Partners recently raised its Nvidia price target to $350 and reaffirmed a Strong Buy rating. Tigress highlighted Nvidia’s dominance across full-stack AI platforms, accelerated computing, and newer growth areas such as robotics, medical imaging, and autonomous driving.
That $350 target now sits near the top of Wall Street’s range. Data from Yahoo Finance shows analyst estimates stretching from roughly $140 on the low end to the mid-$300s on the high end, with the average hovering near $195.
A Familiar Pattern for Nvidia Investors
Taken together, Nvidia’s current setup looks less like a company losing momentum and more like one caught between exceptional fundamentals and shifting market psychology. Rare valuation discounts, continued earnings strength, and expanding strategic reach are colliding with short-term fears around AI spending cycles.
For Bernstein and other bulls, that tension is exactly the point. When Nvidia trades like a normal stock, history suggests it rarely stays that way for long.
