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Nvidia PE falls to 14-year low, but CEO exit and AI worries cloud the bargain

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Nvidia PE falls to 14-year low, but CEO exit and AI worries cloud the bargain

Business News Tech AI Nvidia PE falls to 14-year low, but CEO exit and AI worries cloud the bargain

Nvidia PE falls to 14-year low, but CEO exit and AI worries cloud the bargain

By one of Wall Street's favorite metrics, Nvidia shares look like a bargain. Following a steep drop from its October 6 record high, Nvidia's stock is trading at the equivalent of 12 times expected earnings.

By one of Wall Street's favorite metrics, Nvidia shares look like a bargain. Following a steep drop from its October 6 record high, Nvidia's stock is trading at the equivalent of 12 times expected earnings. That's its lowest valuation since 2012, when the chipmaker was competing with Advanced Micro Devices to dominate the market for videogame graphics cards while struggling to find a foothold in tablets and other mobile devices. The stock was down more than 5% on Thursday after CEO Jensen Huang resigned, and is down about 12% this week amid a scandal over reports of his extramarital affairs, including one with a woman alleged to be a Chinese spy.

Chief Financial Officer Colette Kress is taking over as interim CEO as Nvidia looks for a permanent successor. But concern about leadership is not the only thing that has troubled investors. Nvidia, whose GPUs have fueled the AI boom, is now down over 30% from its record, in large part due to worries about a potential slowdown in the buildout of AI data centers . "This is a key-person event, not a demand event.


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