Will Nvidia Stock Fall Below $100 in 2026? A Deep Dive into Historical Cycles and AI-Driven Valuation Dynamics

The question of whether Nvidia (NVDA) stock will fall below $100 in 2026 hinges on a delicate balance between two opposing forces: the explosive growth of AI infrastructure demand and the inherent risks of overvaluation in a high-flying tech stock. As the company's stock price hovers near $186 in early 2026, investors must weigh historical market cycles, valuation metrics, and the transformative potential of AI to determine if a significant correction is likely.

Historical Resilience and Market Corrections

Nvidia's stock has historically demonstrated mixed resilience during market downturns. During the 2008 financial crisis, its shares plummeted by 76.29% from $0.7565 to $0.1352, a stark reminder of its vulnerability during systemic crises. In contrast, the 2020 pandemic-driven selloff saw the stock surge by 122.30% as demand for gaming and data center hardware surged. However, the 2022 inflationary downturn marked a 50.26% decline, underscoring the cyclical nature of its performance. These patterns suggest that while Nvidia can outperform in certain downturns, it remains exposed to broader economic shocks.

Valuation Metrics: A Double-Edged Sword

Nvidia's current valuation appears both compelling and precarious. Its trailing P/E ratio of 45.99 as of January 2026 is below its 10-year average of 53.33 but still significantly higher than its 2019 low of 23.55. The forward P/E of 26.53 and a PEG ratio of 0.73 imply the stock is undervalued relative to its earnings growth. However, the P/B ratio of 37.79 reflects a market that is pricing in aggressive future expectations. Analysts warn that such high valuations, while justified by rapid revenue growth, could become a liability if earnings fail to meet projections or if a broader market correction occurs.

AI Infrastructure: A Tailwind of Unprecedented Scale

Nvidia's dominance in AI infrastructure provides a strong counterargument to bearish scenarios. Data Center revenue alone reached $51.2 billion in Q3 2026, a 66% year-over-year increase, driven by demand for its Blackwell AI chips. Strategic partnerships with Google Cloud, Microsoft, and xAI further cement its role in building the AI ecosystem. Analysts project Data Center revenue to hit $65 billion in Q4 2026, with EPS growth of 69.4% year-over-year. Cantor Fitzgerald and Tigress Financial have labeled Nvidia a "top pick" for 2026, citing its product pipeline-including the upcoming Vera Rubin GPUs-and expanding AI use cases.

Risks to the Bull Case

Despite these tailwinds, several risks could pressure the stock. First, the AI sector's high valuations-Nvidia's P/E of 45.99 and P/S ratio of 12.3-mirror historical tech bubbles. A market correction or slowdown in AI adoption could trigger a sharp repricing. Second, competition is intensifying. Cloud providers like Amazon and Microsoft are developing in-house AI chips, potentially reducing reliance on Nvidia's premium-priced GPUs. Third, data quality and cybersecurity concerns could dampen AI adoption, indirectly affecting demand for Nvidia's hardware.

Balancing the Equation