Nvidia Stock Trades At 30% Discount: A Rare Value Opportunity For 2026?

Nvidia Corp. (NASDAQ:NVDA) is not supposed to look cheap. Yet as 2026 begins, the most dominant company in artificial intelligence is quietly trading like a value stock.

Shares of Nvidia have fallen about 10% from their late-October peak, even as Wall Street has steadily raised its expectations for the company’s future revenue and earnings.

At current levels, Nvidia trades at roughly 27 times forward earnings, a sharp discount to its own history. Over the past five years, the stock has averaged closer to 38 times forward earnings, making today’s valuation about 30% cheaper than normal.

Analysts still see meaningful upside. According to Benzinga’s Analyst Ratings, Nvidia’s consensus price target stands at $260.61, implying 37% upside from the Jan. 7 close of $189.11.

A Quiet Stock After A Loud Presentation

Earlier this week, Nvidia CEO Jensen Huang stepped onto the CES stage in Las Vegas, delivering what investors have come to expect: ambition, scale and confidence.

He unveiled the Vera Rubin chip platform, now in production. The system is designed to be far more powerful than Blackwell while consuming less energy, cutting the cost of running AI workloads to roughly one-tenth of current systems.

Huang also highlighted Nvidia’s expanding footprint in autonomous driving software and robotics, signaling that the company’s AI ambitions stretch well beyond data centers.

The reaction in the stock, however, was muted.

Despite the bullish showcase, Nvidia shares barely moved. In fact, the stock continued drifting lower, extending a decline that has lingered since late October.

Fundamentals At Records, Valuation At A Discount

That disconnect is what has drawn the attention of seasoned market observers.

Ed Yardeni of Yardeni Research said Nvidia shares look “notably inexpensive relative to expectations for its fundamentals”

Forward revenue, forward profit margins and forward operating earnings per share are all at record levels.

Is the stock catching its breath—or is there something more?

One explanation is simple exhaustion. Since OpenAI launched ChatGPT in late November 2022, Nvidia shares have surged more than 1,000%. That kind of run can leave even the strongest stocks needing a breather.

But Yardeni points to a deeper concern: competition.

Rivals are no longer asleep. Advanced Micro Devices Inc. (NASDAQ:AMD) is pushing aggressively into AI chips with high-memory configurations.

Cloud giants including Amazon.com Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOGL), and Microsoft Corp. (NASDAQ:MSFT) have developed their own custom silicon, increasingly used by their customers.

Qualcomm Inc. (NASDAQ:QCOM) and emerging players like South Korea’s FuriosaAI are also entering the fray.

None of these challengers yet offers the tightly integrated hardware-software systems that have made Nvidia the king of AI computing. But the competitive noise is growing.

Bank of America Sees Nvidia’s Dominance Intact

At Bank of America, semiconductor analyst Vivek Arya is firmly in the camp that Nvidia’s moat remains wide.

Following Nvidia’s CES keynote, Arya reiterated a $275 price target, implying roughly 45% upside from current levels.

He said the event confirmed that AI demand remains “very high,” with scaling trends still accelerating rather than plateauing.

Arya highlighted Nvidia’s ability to deliver both performance gains and cost compression: AI token generation is rising roughly fivefold per year, while the cost per token is falling about tenfold annually.

That efficiency, he said, strengthens Nvidia’s position as customers focus more on returns, not just raw compute.

Beyond Chatbots: Physical AI

Perhaps the most intriguing takeaway from CES was Nvidia’s push beyond text-based AI.

The company introduced Alpamayo, an open AI model platform designed to bring reasoning and decision-making into autonomous vehicles.

Alongside Nvidia’s GR00T models for robotics, it signals a push into “physical AI”—machines that perceive, reason, and act in the real world.

The first passenger vehicle using Nvidia’s new reasoning models is expected as early as the first quarter of 2026.

Why The Disconnect Matters

Nvidia today sits at a crossroads that rarely appears for market darlings. The company is growing faster, innovating aggressively, and expanding into new industries—yet its stock trades at a steep discount to its own history.

Whether this proves to be a rare valuation opportunity or the start of a longer normalization phase will depend on how competition evolves and whether Nvidia can sustain its pace of innovation.

What’s clear for now is that the market’s enthusiasm has cooled faster than Nvidia’s fundamentals.

And that disconnect is exactly what has investors asking a question few would have dared to pose a year ago: Is Nvidia quietly becoming one of the most compelling value stories heading into 2026?

Photo: JRdes / Shutterstock