Down 28%, Nvidia’s Cheap on Paper, But Expensive Once You Read The Fine Print

You ever have that moment where you say something wildly unpopular, and a few months later, it plays out exactly like you said… and suddenly everyone’s acting like they never called you crazy? That’s me right now, except instead of saying pineapple doesn’t belong on pizza (it doesn’t), I said Nvidia could fall under $100. And what do you know… we’re at $96.

But this post isn’t about how I nailed the call (even though I did… no big deal). It’s about how we got here, why it’s worse than most people realize, and why yelling “massive buying opportunity!” at a falling stock might not be the einstein-brain move everyone thinks it is. Let’s rewind to when the air started leaking from Nvidia’s GPU balloon. The Deepseek drama.

You remember right? Back in February when Chinese researchers figured out how to clone ChatGPT for five bucks using locally sourced GPUs. The takeaway was that you don’t need to spend a small nation's GDP on Nvidia hardware to train large language models anymore.

Suddenly, the most overhyped narrative in tech (“Nvidia is the only pick-and-shovel play for AI”) started unraveling at supersonic speed. Nvidia fell nearly 20% in a single day. As if the Deepseek news wasn’t enough to send Jensen’s stress levels through the roof, here comes Huawei with its knockoff chips, ready to fill the void left by Nvidia’s banned H20 processors in China.

The 910C (Huawei’s Frankenstein chip made from fusing two 910Bs together) apparently performs on par with Nvidia’s H100. That’s not the latest chip, sure. But it’s not two tin cans and a string either.

Huawei’s about to go full Costco with these things. Mass shipments next month. The Ascend 920 coming later this year. And guess who’s manufacturing them? SMIC. The same Chinese chipmaker everyone thought couldn’t handle advanced nodes. Joke’s on us. Thanks to Trump’s export ban on Nvidia’s H20 chips, Nvidia had to write off $5.5B in inventory and commitments (pretty big deal).

And that’s not even the worst part… Nvidia was sitting on $18 billion in Chinese H20 orders. That’s revenue they were counting on for next year. Gone. Poof. Just like that guy who swore Web3 was the future and now sells ketamine on Twitter.

If you look at the numbers, some analysts are calling Nvidia a “steal” at a forward P/E of 17, with a PEG ratio under 0.5. Here’s the thing that bugs me…

Everyone throwing around Nvidia’s PEG ratio like it’s the cheat code to generational wealth keeps forgetting the obvious… that exciting little “G” (growth) assumes the growth is real. But right now, that G is looking more like a hallucination.

China  (once Nvidia’s biggest GPU binge-buyer) is basically off the table. Huawei’s rolling out knockoff chips like it’s running a bootleg AI Costco. Deepseek just built its own ChatGPT clone for the cost of a Chipotle burrito. And every week there’s some new regulatory banana peel waiting to trip Nvidia on its way to earnings day. Oh and of course, the House Select Committee is now grilling Nvidia over whether it tiptoed too close to violating those export bans.

So yeah, the stock is down 28% year-to-date and while I might be wrong, I think it could continue to drop. But every time it falls, the permabulls come sprinting out like the Apple just dropped 50% “THIS IS A GENERATIONAL BUY!”.

Really? Let’s play this out. Your biggest customer just ghosted you. Your competitors are slinging decent knockoffs. The government’s watching your every move. And half your inventory just turned into a $5.5 billion doorstop. Still pounding the table? Or maybe, just maybe… you’re finally considering the exit sign.

Even Henrik Alex,  a veteran analyst who’s usually not one to go against the grain initiated a sell rating on Nvidia. He’s calling the 50% growth forecast for 2026 “wishful thinking.” And honestly, he might be onto something.

Nvidia’s still a beast of a company. But great companies don’t always make great stocks… especially not at $96. So maybe yelling “BUY THE DIP” at $120 wasn’t your smartest moment. But hey… don’t stress it. You can always say you were talking about the long term.

PS: The headlines are full of panic… inflation’s too high, the Fed’s asleep at the wheel, and Trump never fails to kill any market momentum with more tariffs. On the surface, it looks like the market’s barely breathing.

But underneath all that noise?

We’re seeing some of the fastest stock moves in years… especially in the small-cap space, where low float and high tension can trigger a 100% pop before lunch. Some are up 200% in under 24 hours… and nobody on CNBC is talking about them.

Except us.

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Stock.News has positions in Apple.