Here's Why Nvidia (NVDA) Fell More Than Broader Market

In the latest trading session, Nvidia (NVDA) closed at $219.82, marking a -2.31% move from the previous day. This change lagged the S&P 500's daily loss of 0.69%. Meanwhile, the Dow lost 0.22%, and the Nasdaq, a tech-heavy index, lost 1.33%.

Heading into today, shares of the maker of graphics chips for gaming and artificial intelligence had gained 10.69% over the past month, outpacing the Computer and Technology sector's gain of 5.97% and the S&P 500's gain of 3.96%.

The investment community will be paying close attention to the earnings performance of Nvidia in its upcoming release. The company is slated to reveal its earnings on August 26, 2026. The company is forecasted to report an EPS of $2.09, showcasing a 99.05% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $91.71 billion, up 96.2% from the year-ago period.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $9.09 per share and a revenue of $387.8 billion, representing changes of +90.57% and +79.59%, respectively, from the prior year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Nvidia. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.02% higher. Nvidia currently has a Zacks Rank of #2 (Buy).

From a valuation perspective, Nvidia is currently exchanging hands at a Forward P/E ratio of 24.76. Its industry sports an average Forward P/E of 41.12, so one might conclude that Nvidia is trading at a discount comparatively.

Investors should also note that NVDA has a PEG ratio of 0.42 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. By the end of yesterday's trading, the Semiconductor - General industry had an average PEG ratio of 0.77.

The Semiconductor - General industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 32, positioning it in the top 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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