Nvidia has been sitting out of the market's rally in recent months, but top names on Wall Street say the bubbling anxiety that has rocked the tech stock could be overblown. Although Nvidia remains up about 38% over the past 12 months, it has trailed its AI peers and lost steam in recent weeks. (For context, Alphabet is up 77% over the past year and chipmakers Broadcom and Advanced Micro Devices have jumped about 51% and 91%, respectively). What's more, shares of the artificial intelligence giant have been largely sideways even as it has announced a slew of products and partnerships and reiterated robust demand. The stock is down 2.6% year to date, lagging the S & P 500 . Its three-month performance sits at a mere 1% gain. Rather than shying away from the stock, however, investors and analysts view its current levels as an increasingly attractive bet — especially with its valuation down significantly from its AI boom peak. They say demand remains strong for its rapidly advancing product pipeline. Behind the funk Veteran tech analyst Paul Meeks attributes Nvidia's dim performance to weak sentiment around the profitability of AI. Nvidia remains as one of his top ideas for the year and he sees the stock reaching $250 per share within the next two years as the AI buildout continues. Investors who do not own the stock "should at least start to build a position at current levels," he said. Meeks, head of technology research at Freedom Capital Markets, said Nvidia's funk is a consequence of the fears that began over the summer around circular AI investing, GPU depreciation, and intensifying competition in the chipmaking space from Big Tech peers such as Google and Amazon . "It's not valuation, particularly on a [price/earnings growth] PEG basis, as it is much below the parity and much below the S & P. I think what happened is — and this essentially has caused the sawtooth pattern ever since about July in the stock — is fundamental worries," Meeks said. "It's fundamental concerns that are more macro than micro-related ... that we're never going to be able to monetize this." NVDA 1Y mountain Nvidia stock over the past year. The biggest catalyst for Nvidia stock would be deal announcements with major customers such as General Motors or Johnson & Johnson , for example, rather than other tech companies, Meeks said. Upcoming fourth-quarter guidance and 2026 AI capex estimates from hyperscalers will be another good data point, he said. Wolfe Research analyst Chris Caso believes it is too early to rule out Nvidia as a long-term AI leader. He named Nvidia his "favorite AI idea" in a Tuesday note to clients, citing the stock's relative underperformance compared with its AI peers and strong inference improvements from the company's Vera Rubin platform compared to its predecessor Blackwell graphics processing units. Nvidia announced the Vera Rubin platform on Jan. 5 at the CES conference. "NVDA is up 'only' 36% over the past year, underperforming other AI related names. We think the reason for underperformance is threefold – the late launch of Blackwell, concerns about the sustainability of AI spending in general, as well as concerns about share losses to custom AI solutions," he wrote. "The continuous jumps in performance allow NVDA to price to value, and to hold margins," he added. Nvidia shares got battered in November on news of greater chip competition , particularly after a report from The Information said that Meta Platforms was considering using Alphabet's tensor processing units. Nvidia pushed back and said there are broad use cases for its GPUs compared to TPUs. Bulls like Meeks remain confident that the AI chip market is in early stages, and that it is far too early to declare a winner even with more players in the space. 'Add when there's weakness' Hank Smith, director and head of investment strategy at Haverford Trust, said Nvidia shares have flatlined in recent months as investors rotated away from growth stocks — a trend that began in the fourth quarter of 2025. But he's also in the camp that Nvidia's steady product development, as seen with its high-demand Blackwell architecture and Vera Rubin platform, still support the case for the company's long-term growth. Any weakness in Nvidia opens a prime buying opportunity, Smith said. He would be inclined to add to his position if there is a further downdraft in Nvidia's share price. For Smith, that means near $160 or $150 per share. His firm, which manages large, dividend-paying stocks, has owned Nvidia since the spring of 2024. "That has been the play really, for three, four years now, is you add when there's weakness. I don't see why it's quote different this time," he said. Given that Nvidia trades between 25 and 27 times forward earnings estimates, the stock has exited "nosebleed territory," and isn't at as great of a risk of a correction, Smith said. "Earnings growth has outpaced share price appreciation, so you've had a contraction in the in the multiple," he said. "I think it's just more of of the market rotating, which by the way is a healthy thing. ... These high growth stocks are volatile." On Wednesday, Nvidia shares were shedding another 2% in trading. The recent pullback has prompted a handful of analysts this week to reiterate their bullish, long views on the chipmaker. Baird analyst Tristan Gerra reiterated Sunday his outperform rating and named the stock a top idea for 2026, given that its multiple is trading at a hefty discount to its AI peers. In a note to clients, he also called out Nvidia's "strong and unchallenged positioning" in AI data center markets, lack of relevant competition for the medium term and new product roadmap and software ecosystem. He has a $275 price target. "We dispute Street's assumptions embedded in Nvidia's current multiple that Nvidia's share in AI will decline notably when inferencing gains momentum. We note that while hyperscalers own the bulk of their custom ASIC IP, Nvidia owns all its IP," Gerra wrote. Bernstein analyst Stacy Rasgon on Monday also named Nvidia a top pick, crediting unabated AI spending levels and the stock's "extremely attractive" valuation.
