Shares of Nvidia (NVDA) have diverged from the trajectory of their earnings expectations lately, raising questions about the durability of the stock’s latest rally, data compiled by Goldman Sachs showed.
While consensus forward earnings per share estimates have continued to climb steadily, Nvidia’s share price has struggled to keep pace and has moved largely sideways after a strong run earlier in the cycle. The gap marks a shift from much of the past two years, when price gains closely tracked, and often anticipated, upgrades to profit forecasts tied to booming demand for artificial intelligence chips.
The recent dislocation suggests investors may be reassessing valuation multiples even as analysts lift earnings projections. With the stock still up sharply from late 2022 levels, some portfolio managers point to profit-taking, positioning pressures, and broader market volatility as potential drivers of the pause.
The divergence also reflects heightened sensitivity to execution risks, supply constraints, and competition in the AI semiconductor space. For now, earnings momentum remains intact, but the stock’s next move may depend less on upward revisions and more on whether Nvidia can clear an increasingly high bar of expectations.
The company will release its fourth-quarter results on Wednesday after the market close.
Here is a chart from Goldman Sachs posted by Mike Zaccardi on X:
Goldman Sachs