Down 11%, Should You Buy the Dip on Nvidia?

Core Viewpoint - Nvidia has experienced significant growth due to its role in the AI infrastructure layer, making it a compelling investment opportunity despite recent stock price fluctuations [2][3]. Financial Performance - Nvidia's revenue surged by 62% year-over-year to $57 billion in Q3 2026, with analysts projecting further increases of 51% and 28% for fiscal years 2027 and 2028, respectively [3]. - The company's net income margin has dramatically improved from 11% to 56% over the past three years, showcasing exceptional profitability [3]. Innovation and Product Development - Nvidia's management prioritizes innovation, recently unveiling the Rubin computing platform, which promises a 10x reduction in inference token costs and a 4x reduction in GPU requirements compared to its predecessor [4]. - The launch of Alpamayo, an open-source AI model aimed at supporting autonomous driving technology, positions Nvidia to compete with Tesla in the automotive sector [5]. Market Position and Valuation - Nvidia's current market capitalization stands at $4.5 trillion, with shares trading at a forward price-to-earnings ratio of 23.9, suggesting that the stock may still be a good buy during its current dip [6][7]. - Despite a recent 11% decline from its peak, the stock is viewed as trading at a discount, prompting some investors to consider it a favorable entry point [2][6].