Key Takeaways Tom Lee from Fundstrat maintains Nvidia remains undervalued, noting the stock’s P/E ratio continues to decline despite extraordinary earnings expansion The chipmaker delivered Q
Tom Lee, Fundstrat’s Head of Research, continues to champion his optimistic outlook on Nvidia (NVDA). Despite the stock’s impressive run and exceptional quarterly results, Lee maintains the shares remain attractively priced.
“What’s remarkable is that Nvidia’s valuation multiple remains exceptionally modest,” Lee explained during a CNBC interview. “They’re delivering massive upward revisions. The stock price hasn’t caught up. The P/E ratio continues to compress.”
Shares of NVDA started trading at $227.98 on Friday morning. The equity’s 52-week trading range spans from a low of $164.07 to a peak of $236.54, resulting in a market capitalization of $5.52 trillion.
Nvidia announced Q2 revenue totaling $96.22 billion, marking a 105.9% year-over-year surge. Earnings per share reached $2.22, exceeding the Wall Street consensus forecast of $2.09 by thirteen cents.
The company’s prior-year EPS stood at $1.05, highlighting the dramatic year-over-year earnings acceleration.
Management also provided forward revenue guidance of approximately $108 billion for the upcoming quarter. This robust outlook continues to fuel bullish sentiment among Wall Street analysts.
Fundstrat described Nvidia’s triple-digit revenue expansion as “absolutely remarkable.” In a research note dated August 26, the firm indicated that Nvidia’s 2028 revenue projections “could propel shares toward fresh record highs.”
Blue Zone Wealth Advisors expanded its Nvidia allocation by 21.4% during Q2, elevating its total holdings to 129,666 shares with an estimated value of $25.9 million. Nvidia currently represents 4.5% of the advisory firm’s total portfolio, ranking as its seventh-largest investment.
Additional institutional investors also boosted their positions. Longfellow Investment Management increased its stake by 47.9% in Q2. Both Spurstone Advisory Services and Phillip James Consulting initiated fresh positions during the same timeframe. Institutional investors and hedge funds now control 65.27% of Nvidia’s total outstanding shares.
The Wall Street consensus price target stands at $322.61, with 48 analysts assigning a Buy rating, two issuing Strong Buy recommendations, and four maintaining Hold ratings.
Nvidia’s board of directors approved an $80 billion stock buyback initiative in May. Additionally, the company announced a quarterly dividend distribution of $0.25 per share, scheduled for payment on October 1 to shareholders of record as of September 10.
Conversely, company insiders have divested approximately $410.4 million in stock value throughout the past 90 days. Board member Stephen C. Neal disposed of 15,500 shares at an average price of $215.73 in early June. Director Mark A. Stevens sold 885,000 shares at $210.17 in mid-June.
Rosenblatt Securities established the most ambitious price target for Nvidia this week at $390. Both UBS and Jefferies maintain $300 price objectives alongside Buy recommendations.
The stock’s current P/E ratio measures 28.82, accompanied by a PEG ratio of 0.41 and a beta coefficient of 2.23.
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