Nvidia’s AI Dominance Fuels Stock Rally—But Is a Correction Coming?

Nvidia (NVDA) continues its meteoric rise, up 80% year-to-date as demand for AI chips outpaces supply. But with a P/E ratio over 90, some analysts warn of dot-com-era parallels.

"The AI revolution is real, but valuations are stretched," warns David Trainer, CEO of New Constructs.

Why Nvidia Is Still Winning

- AI Chip Monopoly: Controls ~80% of the AI GPU market.

- Data Center Boom: Q4 revenue surged 409% YoY to $18.4B.

- Software Push: New AI enterprise tools could boost margins.

Risks to Watch

Competition: AMD and Intel are racing to catch up.

Geopolitics: US-China tensions could disrupt supply chains.

Bubble Fears: NVDA’s market cap ($2.2T) now rivals Amazon’s.

Should You Buy Now?

- Long-term believers: AI adoption is still in early innings.

- Short-term traders: Wait for a pullback below $800.