Is Nvidia Stock a Buy?
Shares of Nvidia (NASDAQ: NVDA) have been unstoppable since the arrival of artificial intelligence (AI). AI-related demand supercharged sales of its advanced semiconductor chips, called graphics processing units (GPUs), and consequently the stock is up about 55% during the past 12 months alone (as of Feb. 2).
The share price increase can make investors question whether Nvidia stock is worth buying. After all, its price-to-earnings (P/E) ratio, which reflects how much investors are paying for a dollar's worth of earnings based on the trailing 12 months, exceeded 47 as of Feb. 2, and that isn't cheap.
This analysis breaks down whether Nvidia shares are worth the elevated valuation. If so, now may be the time to buy, before its fiscal fourth-quarter earnings report scheduled for Feb. 25.
Source Fool.com
