Nvidia Stock Sees Wild Ride: Top Analyst Warns of Overvaluation

Nvidia's stock has rebounded 83% since hitting a 52-week low in April, driven by renewed optimism around AI demand and the removal of export restrictions to China. However, top analyst Brett Ashcroft Green urges caution, arguing that the recent rally has run too far, too fast and that supply constraints limit growth. Green rates Nvidia shares a Hold, citing high valuations and advises waiting for better prices. Wall Street maintains a bullish stance with a Strong Buy consensus and an average price target of $182.06.

Nvidia's stock has rebounded 83% since hitting a 52-week low in April, driven by renewed optimism around AI demand and the removal of export restrictions to China. The company's shares have surged as investors anticipate increased sales of its AI hardware, particularly the H20 GPU, which was previously banned for shipment to Chinese entities [2].

The recent rally has been fueled by strong earnings reports from major tech companies like Microsoft and Meta Platforms, which have shown a steadfast commitment to AI spending despite economic uncertainties. Nvidia's stock has benefited from this trend, as the company's products are essential for AI applications [1].

However, top analyst Brett Ashcroft Green urges caution, arguing that the recent rally has run too far, too fast and that supply constraints limit growth. Green rates Nvidia shares a Hold, citing high valuations and advises waiting for better prices. Despite this cautious stance, Wall Street maintains a bullish stance with a Strong Buy consensus and an average price target of $182.06 [1].

The removal of export restrictions has also contributed to the stock's rebound. The U.S. government lifted its ban on shipments of Nvidia's H20 processors to Chinese entities, pleasing the company, its Chinese customers, and investors. However, concerns remain about the potential misuse of these GPUs by Chinese companies, with some lawmakers advocating for new export rules to address these issues [2].

Nvidia's fiscal 2026 second-quarter results are expected to be announced on Aug. 27, and analysts forecast the company to earn $4.29 in fiscal 2026 earnings per share (EPS) and $5.76 in fiscal 2027 EPS. If the stock price remains unchanged and earnings come in as expected, the stock would feature a rather inexpensive valuation in less than two years [1].

In conclusion, while Nvidia's stock has rebounded significantly, investors should exercise caution due to potential supply constraints and high valuations. The company's future performance will depend on its ability to maintain high growth rates and margins, as well as the development of new export rules for AI hardware.

References:
[1] https://www.fool.com/investing/2025/07/16/4-dow-jones-stocks-buy-52-week-high/
[2] https://www.tomshardware.com/pc-components/gpus/u-s-legislators-criticize-decision-to-resume-nvidia-h20-gpu-shipments-to-china-demand-new-export-rules-for-ai-hardware