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Nvidia stock has pulled back from its May peak and is gradually approaching bear market territory. The shares have fallen nearly 20% from their year-to-date high, erasing billions of dollars from Jensen Huang’s fortune and inflicting losses on investors.
Jensen Huang’s Net Worth is Falling as Nvidia Stock Retreats
Forbes and Bloomberg estimate that Jensen Huang’s net worth has increased by $5.2 billion this year to $160 billion, making him the world’s ninth-richest person.
He ranks behind Tesla’s Elon Musk, Google co-founders Larry Page and Sergey Brin, Amazon’s Jeff Bezos, Dell’s Michael Dell, Oracle’s Larry Ellison, and LVMH’s Bernard Arnault.
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Huang’s wealth has tumbled from nearly $200 billion earlier this year, mirroring the performance of Nvidia, the company he started in 1993. Its stock has dropped from a record high of $236 to the current $196, with its valuation falling from $5.72 trillion to $4.6 trillion today. He owns a 3% stake in the company.
Analysts are Optimistic About Nvidia’s Shares
Despite the ongoing retreat, analysts are still highly optimistic about the company, which has become the poster child of the artificial intelligence supercycle.
Data compiled by Benzinga Pro shows that the average estimate among analysts tracking the company is that its shares will jump to $309, up by 62% from the current level.
Some analysts are more optimistic than that, with Baird’s Tristan Gerra estimating that it will jump to $500. Some of the other highly bullish analysts are from companies like Benchmark, Tigress, and DA Davidson.
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The general view among analysts is that Nvidia is a growth company that is trading as a value stock. For one, its revenue and margin growth have surged in the past few months as demand for its solutions has soared. In its recent earnings report, the management predicted that it would make over $90 billion in the current quarter.
Despite this growth, Nvidia trades with a forward price-to-earnings multiple of 22, slightly lower than the S&P 500 average of 23. Its price-to-earnings-to-growth ratio has also dropped to 0.048, lower than the 5-year average of 1.47.
