Is Nvidia Stock a Buy Now?
As 2023 draws to a close, Nvidia (NASDAQ: NVDA) has clearly been one of the standout performers on the stock market with terrific gains of 211%. Investors may be wondering if they should be buying this high-flying chipmaker right now in anticipation of more gains, especially considering its dominance in the lucrative market for artificial intelligence (AI) chips.
Nvidia's eye-popping surge this year has inflated the company's valuation. The stock is now trading at almost 25 times sales as compared to 13 times sales at the end of 2022. However, a closer look at Nvidia's valuation, stellar growth, and bright prospects will tell us that investors are still getting a good deal right now. Here's how.
Nvidia is carrying a rich price-to-sales ratio right now compared to where it was at the end of 2022. However, it is worth noting that the current sales multiple of 25 isn't very high when compared to its five-year average sales multiple of 20. What's more, Nvidia's sales multiple has come down in recent months thanks to the outstanding acceleration in its top-line growth.
Source Fool.com
