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Nvidia Stock Tanks After Hours — China Trouble Wipes Out Billions Despite Blowout Earnings. Nvidia’s stellar 56% revenue jump was overshadowed by a sharp China sales slump and mounting regulatory hurdles, sending its shares plunging over 5% in after-hours trading.

https://sg.finance.yahoo.com/news/nvidia-shares-slip-hours-trading-093000766.html

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Stock Analysis Report: NVIDIA Corporation (NVDA) — August 2025

1. Durable Economic Moat

NVIDIA commands an almost unassailable lead in AI hardware, controlling over 80% of the GPU market for AI, embedded through its CUDA software platform, developer ecosystem, and tight integration with data center workflows.

The Blackwell architecture furthers this advantage, driving leaps in AI training and inference performance

Conclusion: NVIDIA possesses a very wide and enduring moat, unlike nearly any other tech company.

2. Strong Financials

Q2 FY26 results: Revenue $46.7B (+56% YoY), with Data Center contributing $41.1B—highlighting massive scale in AI demand

Margins: Non-GAAP gross margin stood at ~72.7%, reflecting durable pricing power
Profit & Cash Returns: Net income rose 59% YoY; management returned $24.3B in capital via share buybacks in H1 FY26, and approved an additional $60B authorization
Future Outlook: Q3 revenue guidance of $54B tops expectations, suggesting continuing strength

Conclusion: Financials are exceptionally strong and expanding, backed by consistent cash generation and shareholder returns.

4. Margin of Safety / Valuation

Valuation: NVDA trades at ~58x trailing earnings (high), but justified by PEG ratio (~0.68) and industry-leading growth

Analyst views: Morningstar raised its fair value to $190 (from $170), albeit with very high uncertainty. analysts see upside to $210 based on AI dominance

Skeptical views: Peter Thiel suggests current valuations may echo dot-com excesses; investors remain cautious amid hype concerns

Narrative: The valuation today is based heavily on future expectations—some argue it already prices in much of NVDA’s growth story

Conclusion: There is limited margin of safety—valuation is elevated and expects perfection, leaving little downside cushion for mistakes or macro shocks.

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NVIDIA has a very strong business moat in AI chips and platforms, backed by dominant market share, software ecosystem lock-in, and visionary leadership. Its financial growth remains exceptional, with soaring revenue, margins, and cash returns. However, the stock’s valuation leaves little margin of safety, making it a world-class business—but one best bought at a more attractive entry point.

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Please do your own due diligence before making any investment decisions.