Nvidia suffers seven consecutive declines, marking the longest streak since 2022: year-to-date stock rise is only 7%, ranking at the bottom, yet analysts have raised profit forecasts by 13% over the past three months.

Nvidia’s share price has fallen for the seventh consecutive trading day, setting the longest losing streak since 2022.

On Monday, Nvidia’s stock closed down 2.91%. Since the beginning of this year, Nvidia’s cumulative increase is only about 7%, ranking at the bottom among the constituents of the Philadelphia Semiconductor Index. AI chip spending is now being spread more widely across other semiconductor companies.

Valuations have also moved down in tandem—Nvidia’s forward price-earnings ratio has dropped to around 18 times, hitting a new multi-year low. While fundamentals remain strong, the market is becoming more cautious in pricing AI hardware.

In contrast to the falling share price, Wall Street analysts continue to raise profit forecasts for Nvidia. Over the past three months, expectations for profits have increased by a total of 13%. The divergence between share price and fundamentals is the most notable signal in this market correction.

Reassessment of Valuation and Profit Quality

Nvidia’s forward price-earnings ratio has dropped to about 18 times, reaching a new multi-year low. The market is more cautious in valuing AI hardware, reflecting investors’ ongoing scrutiny of profit quality and customer concentration.

Nvidia’s previous 10-Q filing disclosed that of its $58 billion net profit, $13.4 billion came from unrealized gains on listed equity holdings. After excluding this, the normalized net profit would lead to a P/E ratio of nearly 60 times. Its top three customers together contributed 54% of revenue.

Despite share price pressure, Wall Street analysts still continue to raise Nvidia’s profit forecasts.

In the past three months, Nvidia’s profit forecasts have been raised by a cumulative 13%, and it is projected to achieve $228 billion in profit for fiscal year 2027. Among 82 tracking analysts, only three give a hold rating and one gives a sell rating. The average target price implies more than 50% potential upside.

Fundamentals are expected to remain robust as well. Nvidia’s data center business is projected to achieve $193.7 billion in revenue in FY2026, as the scarce value of upstream computing power is realized first.

In terms of capital return, Nvidia authorized an additional $80 billion in share buybacks in the quarter ending April, surpassing Apple as the largest single buyback entity in the U.S. stock market.

It remains to be seen whether Nvidia can stabilize after this period of continuous correction and whether analysts’ ongoing profit upgrades will be reflected in the share price.