Nvidia Just Had Its Worst Day Since DeepSeek, Losing About $450 Billion
Nvidia's revenue is doubling and its forward multiple has shrunk to 15x, yet one political shock erased a staggering chunk of its value. The real threat may sit in the data centers where its chips are headed.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Shares of Nvidia (NASDAQ:NVDA | NVDA Price Prediction) closed at $181.60, and Wall Street’s consensus price target is $327.14. Reaching that target would take a gain of about 80%.
The gap opened in a single session. Nvidia fell 9.26%, its largest one-day percentage drop since the DeepSeek selloff, and lost about $450 billion in market value as chip stocks sold off after the midterm elections.
Nvidia’s own results remained strong. Last quarter, revenue came in at $96.22 billion, up 105.8% from a year earlier, and management guided to $108.0 billion for the current quarter.
The market is repricing the outlook for Nvidia’s customers. If the Democratic sweep brings tougher AI rules and slows the expansion of computing facilities, the cloud giants that fill their buildings with Nvidia systems could spend less. A target built for a full-speed expansion would then be too high.
Washington Risk Hit Nvidia’s Customers Before Its Chips
The selling was broad. The PHLX Semiconductor Index fell more than 12%, the Nasdaq dropped 5.52%, and the S&P 500 fell 4.22%.
Nvidia gets paid when data centers get built. Permits, power connections, and new regulations can push back hyperscaler orders even while Nvidia’s hardware stays the first choice (the power, cooling, and networking suppliers behind those buildings are the whole subject of a free report we put together on AI infrastructure names that aren’t the chipmakers). Peter Boockvar of OnePoint BFG Wealth Partners said stocks linked to the AI expansion will likely fall if that expansion slows, even if the technology keeps improving.
DeepSeek day was a different kind of shock. Nvidia fell 16.97%, from $142.62 to $118.42, on fears that cheaper models would need fewer chips. That fear faded as AI use grew, but a policy-driven slowdown could last as long as the policy does.
Double Volume Signals Heavy Selling Pressure
Nvidia traded 307,846,650 shares, about double the prior session’s 149 million. The stock fell from a high of $196.25 to a low of $181.46 and closed near the bottom of that range.
It broke below its 200-day moving average and posted its lowest close since $178.10 in April. It is down 15% over the past month.
Heavy volume through a long-term average likely shows heavy selling pressure. Advanced Micro Devices (NASDAQ:AMD) fell 15.59% on the day and 28.6% over the week, so the selling hit the whole AI chip group.
A 15x Forward Multiple Works Only If Earnings Hold
After the drop, Nvidia trades at a forward P/E of 15x and a trailing P/E of 23x. That multiple is low for a company growing this quickly. Management, by contrast, guided to about 70% revenue growth next fiscal year.
A low multiple turns into a trap when estimates fall. If hyperscaler spending slows or data-center permits stall, earnings forecasts shrink. A stock that looks cheap today would then be fairly priced only at a lower share price.
China adds to the risk. Guidance assumes no compute revenue from China. Roughly 600,000 H200 chips are reportedly sitting in Hong Kong while they wait for Beijing’s approval, and several large Chinese internet companies have reportedly received about 10,000 units each.
Nvidia also has $279 billion in supply commitments, mostly memory for Vera Rubin. Those commitments become a burden if orders cool.
Near-Unanimous Bullishness Leaves Little Room for Upgrades
Analysts rate Nvidia 10 strong buy, 49 buy, 2 hold, and 1 sell. When nearly everyone is already bullish, few upgrades remain, and there is plenty of room for target cuts.
The bull case rests on supply. On the last earnings call, CFO Colette Kress said, “We expect to grow revenue by approximately 70% in fiscal 2028. This is a supply-constrained outlook.”
Nvidia is down 2.4% this year, while the S&P 500 is up 7.49%. Price targets are only one input, and a gap this wide likely means analyst targets have yet to reflect the selloff.
Earnings are expected after the close on November 17. Listen for data-center demand, any China update, and whether the fiscal 2028 outlook still holds.
What Would Confirm or Break the Bull Case for Nvidia
The upcoming report is likely to settle the debate. If it confirms that orders still exceed supply, a 15x forward earnings multiple would likely undervalue the company at the center of AI spending.
But the bear case gains strength if management reduces fiscal 2028 guidance or customers start delaying projects over permits and regulation. In that case, the $327.14 target would drift down toward the share price.
AMD faces a different setup, because even after its slide, it is still up 88.83% this year. That leaves it with more gains to give back.
Nvidia starts from the cheaper valuation. A drop driven by political fear, with no change in the company’s reported numbers, likely leaves room for recovery if the fiscal 2028 outlook holds.
Contact [email protected] for any questions or corrections.
Omor Ibne Ehsan is a writer at 24/7 Wall St. He is a self-taught investor with a focus on growth, cyclical, and dividend equities that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as penny stocks.
