Nvidia reports fiscal Q2 2027 earnings on Wednesday, Aug. 26, with Wall Street expecting 97% year-over-year growth. A Motley Fool analyst argues the stock's current valuation, cheaper than fellow AI-chip makers AMD, Broadcom and Marvell, may not last much longer if the report beats expectations.
Nvidia stock trades at a 24 times forward earnings multiple heading into its fiscal 2027 second-quarter report, due Wednesday, Aug. 26, for the quarter ended July 30. That is barely above the S&P 500's 21.4 times forward earnings, according to Motley Fool analyst Keithen Drury.
Nvidia's stock price is up 15% in 2026, ahead of the broader market's 12% rise but short of the outperformance the company posted in the previous three years. Drury writes that Nvidia has posted strong results so far in 2026 that support its growth thesis, yet the market has grown skeptical.
Drury compares Nvidia against two categories of AI computing rivals: broad-purpose GPU makers and custom AI chip suppliers. Advanced Micro Devices competes in GPUs, while Broadcom and Marvell Technology compete in custom AI chips. On a trailing price-to-earnings basis, Drury says Nvidia has the lowest valuation of the four.
He notes the trailing measure omits growth, so he also compares forward P/E ratios that incorporate each company's projected growth for the fiscal year — and finds Nvidia still the cheapest of the group on that basis.
Wall Street analysts currently expect 97% year-over-year growth from Nvidia in the upcoming report. Drury argues that if Nvidia beats those expectations, the stock could be primed for a rally given its relatively low starting valuation, adding that the outlook could shift depending on the quality of Nvidia's earnings and how the market reacts once the numbers are out.
Source: The Motley Fool
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