Three Months After CEO’s Uptick Call, Nvidia Trails Diversified AI Basket

Key Points

CEOs routinely advocate for their companies during challenging periods, yet Jensen Huang’s mid-June endorsement of Nvidia shares came amid a widespread downturn in artificial intelligence equities. With the stock showing modest gains of approximately 4% since his remarks, performance appears underwhelming—particularly in comparison to alternative strategies within the sector.

Nvidia Trails Sector Peers After Three-Month Span

Huang issued his “buy” recommendation nearly three months prior, asserting that AI represented a durable long-term trend. Since then, Nvidia’s shares have returned roughly 4%, aligning closely with broader market indices like the S&P 500. This alignment, however, pales against an equal-weighted portfolio combining Nvidia and other major AI players. Allocating equally across tech stalwarts such as Microsoft, Amazon, and Alphabet would’ve yielded an estimated 8% return—double that of Nvidia alone.

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Image source: Nvidia Corporation.

The diversified AI basket’s outperformance stemmed largely from Microsoft’s robust 24% surge. Meanwhile, Alphabet declined by 5%, and Amazon advanced 8%. These variances underscore the importance of evaluating performance over extended horizons rather than brief intervals. For long-term investors, short-term volatility shouldn’t overshadow strategic positioning based on fundamental value drivers.

Huang’s bullish stance reflects confidence rooted in tangible metrics. Q2 FY2027 earnings revealed sustained demand, with revenues climbing 18% sequentially and soaring 106% year-over-year—a clear indicator of enduring momentum in AI infrastructure deployment.

Still Priced Favorably?

Although exponential growth may eventually normalize, current valuations remain attractive relative to historical benchmarks. Trading at 17.5 times earnings—below its five-year average of 23x and notably cheaper than the S&P 500’s 25x multiple—Nvidia presents compelling entry points for patient investors.

Should You Invest Today?

Prospective buyers should weigh these considerations:

Motley Fool Stock Advisor recently spotlighted what experts deem the top 10 growth stocks poised for outsized returns. Notably absent from this curated list: Nvidia itself. Past selections, however, speak volumes—Netflix subscribers saw returns exceeding 440K% post-inclusion, while Nvidia shareholders enjoyed gains surpassing $1.3M on initial investments.

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*Stock Advisor returns as of August 31, 2026.

Reuben Gregg Brewer holds no positions in mentioned securities. The Motley Fool owns and endorses Alphabet, Amazon, Microsoft, and Nvidia.

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