Share prices of Nvidia (NASDAQ: NVDA) hit a record high last week, driven by updated reports showing a booming demand for its graphics cards, which are being sucked up by companies in the artificial intelligence (AI) arms race.

The semiconductor stock is up a massive 232% in 2023 so far, which also explains why it is trading at an expensive valuation. With a price-to-sales ratio of 37 and trailing earnings multiple of 117, there is no doubt that Nvidia is valued at a huge premium to the S&P 500's sales multiple of  2.5 and price-to-earnings ratio of 20.

But despite these rich multiples, certain Wall Street analysts still consider Nvidia stock to be a bargain. Let's see why that's the case.

Continue reading

Source Fool.com