Despite Nvidia’s rally, some say the stock is actually cheaper

NEW YORK/SAN FRANCISCO: Even after Nvidia Corp’s blistering rally in recent days, the chip developer’s valuation has actually fallen, at least by one measure widely used by analysts and investors.

The chip developer has risen more than 31% in the last three sessions including a 3% gain on Tuesday to $401.11. At one point during the session, its market capitalization surpassed $1 trillion.

Nvidia now trades at around 45 times Wall Street’s average earnings estimates for the next 12 months – a popular measure known as the forward price/earnings (P/E) ratio. But it had traded at a multiple of 62 on May 18, roughly a week before Nvidia’s quarterly update sent the market into a frenzy, according to data from Refinitiv.