Nvidia Stock: Is It Still a Good Buy at $230?

Nvidia (NASDAQ:NVDA)'s stock is having another terrific year in 2026, rising by around 24% thus far. Although it was initially off to a poor start, it's beating the market yet again, as the S&P 500 has risen by a more modest rate of 13%. The tech giant has been leading the artificial intelligence (AI) revolution with its cutting-edge chips, and its recent quarterly results showcased just how strong demand remains, with its growth rate accelerating from the previous quarter. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Currently, the AI stock is trading around $230 as it approaches a new all-time high. Is it still a good buy at its current levels? Image source: Getty Images. Nvidia's valuation looks low given the growth it's been generating At around $5.6 trillion in market cap, Nvidia is easily the most valuable company in the world. What's striking, however, is just how inexpensive the stock is given its high level of profitability. The stock trades at a price-to-earnings (P/E) multiple of 29. While that is a bit higher than the S&P 500 average of 24, it's arguably warranted given just how strong its growth has been. Nvidia's revenue for its most recent period, which ended on July 26, totaled $96.2 billion -- a whopping 106% increase year over year. That's a significant acceleration from the 85% growth it reported three months earlier. Paying such a modest multiple for this type of growth makes Nvidia's stock look like a steal of a deal. CEO Jensen Huang also remains bullish on the future growth of the business, now that AI tokens are paying off. "AI has reached its inflection point. It's doing useful work. Its tokens are productive and profitable. Now, compute is revenue," Huang stated in the company's earnings release. The caveat with Nvidia's stock Nvidia has been a growth beast and its business looks as though it's ramping up at a time when many investors may have assumed it might be due for a slowdown, given an increase in competition. In light of its recent numbers, it wouldn't be surprising for Nvidia's stock to continue to hit new heights this year. The one risk with the stock, however, is that it depends heavily on many interconnected tech companies and on their continued commitment to spending big on AI. If there's a pullback in AI spending, that could have a drastic and sudden impact on Nvidia's growth. While that doesn't appear likely today, if there's an economic downturn or interest rates rise, there may be increased pressure for companies to scale back capital expenditures. It's a risk that investors who buy Nvidia's stock need to be aware of, because while its valuation doesn't look all that high right now, things could change quickly. Should you buy stock in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $421,997!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,413,876!* That performance is why people listen. With a track record of beating the S&P 500 by nearly 5x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of September 7, 2026. David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. Nvidia Stock: Is It Still a Good Buy at $230? was originally published by The Motley Fool More News