Nvidia sheds $1T, now trades at cheapest multiple since 2019

A trillion dollars in market cap has come off Nvidia in under two months, and the more interesting part isn't the number itself, it's what the market is now willing to pay for the company. According to Bloomberg, the stock has slid 16% from its May 14 all-time high and now trades at 18 times earnings projected over the next 12 months. That's the cheapest multiple Nvidia has carried since early 2019, before the AI boom took off. It also puts Nvidia below the S&P 500 at more than 20 times and the Nasdaq 100 at nearly 23 times.

The rerating is happening without a matching business-fundamentals story. Analysts are still lifting earnings forecasts, Nvidia is on track for the fourth-fastest revenue growth in the S&P 500 this year, and its grip on the server GPU market was roughly 97% at the end of 2025, up from 95% the year before. What is moving is where AI money is going. Bloomberg's read is that investors are rejiggering the AI trade by ditching Nvidia in favor of competing semiconductor manufacturers, particularly those in the memory market.

The odd part sitting on top of all this is that Nvidia is now less expensive on a forward-earnings basis than about half of the S&P 500, a list that includes candy maker Hershey and utility Dominion Energy. Whatever your view of the AI cycle, that's a reset worth pausing on. If you thought Nvidia was priced for a mania and the mania was going to snap, you'd expect earnings estimates to be coming down first, not multiples compressing while forecasts keep rising.

The honest caveat is that a valuation compression story is not a bubble-popping story, and the reporting doesn't settle whether this is a rotation trade running its course or the front edge of something bigger. What the Bloomberg piece doesn't give you is a clear read on whether hyperscaler capex is actually decelerating or just pausing between build cycles, or how much of the move is positioning rather than fundamentals. Take the specifics as reported, not as settled.

For anyone allocating around the AI trade, the practical read is that the sector's bellwether is now priced closer to a normal growth stock while still owning most of the market, and the interesting question is who else in the AI stack gets rerated next.