ChatGPT-4o: NVIDIA overvalued or undervalued?

In this video, you'll learn how to use ChatGPT-4o to analyze a stock - NVIDIA using multiple valuation approaches such as:

Discounted cash flow analysis
Top-down analysis
P/E based analysis

Based on all these valuations, ChatGPT-4o believes NVIDIA is overvalued.
No investment advice.

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[mircea_h]

in the fcf table, the 40% growth rate is slower than what we know today. nvidia has
60b for 2024,
+120b 2025,
approx 200b 2026,
so this initial growth is much higher than 40% today for this year. so in 2026 we will have 2028 as per your table revenue +200b. maybe this helps compunding later on.

todays growth is higher than 40% but 10 years later i don't know about 40% correct, depends on how many industries will use it

then again out of 800b market share for AI, if nvidia has 75% thats 600b and with a 50% margin, that will be 300b profits, which compared to todays apple 170b / year should equal to about 2x appl market cap today.

key question how much market is there for AI. will countries buy in and each build their own DCs ? will military buy in ? healthcare, it, etc ? if this is the start of next industrial revolution, all industries will start to use AI to improve productivity

[dprankypd]

What kind of "research" have you done leading you to believe that expectations are reasonable?

There is a very simple thought experiment that can be performed - in a world where Nvidia's future cash-flows discounted to today sum up to more than $2.78T, what else is true? How much energy will be used to train and inference LLMs / generative AI? How much liquid cooling and other surrounding infrastructure needs to be built in order to achieve this? And how much money (balance sheet + free cash flow) do the hyperscalers / enterprises / automotive and budgets do sovereign have to enable this? But most importantly, how much revenue & profit needs to come through the other side to justify this?

Sorry to say, but ChatGPT is correct in this case... Nvda puts for Dec 2026 are the play here