Fundstrat Head of Research Tom Lee is standing by his bullish view on Nvidia (NVDA), arguing that the stock still looks inexpensive even after a strong rally and a blowout earnings report.

“The thing that stands out is that Nvidia’s multiple is still very low,” Lee told CNBC. “They’ve got these huge revisions. The stock hasn’t kept up. Now the P/E keeps contracting.”

In effect, Lee is describing a gap: profit estimates have risen faster than the share price, which mechanically pushes the price-to-earnings ratio lower.

NVDA opened at $227.98 on Friday, within roughly 4% of the top of its 52-week range of $164.07 to $236.54. The company’s market capitalization is $5.52 trillion, placing it among the most valuable publicly traded companies in the world.

Nvidia reported second-quarter revenue of $96.22 billion, up 105.9% from a year earlier. Adjusted earnings per share were $2.22, beating the consensus estimate of $2.09 by $0.13 and more than doubling the $1.05 posted in the same quarter last year.

The company also guided for approximately $108 billion in revenue for the current quarter — about 12% above the $96.22 billion just reported — a forecast that has continued to support analyst confidence in the stock and that sets the bar for Nvidia’s next quarterly report. Fundstrat described Nvidia’s 100%-plus revenue growth as “just astounding.” In an August 26 note, the firm said Nvidia’s 2028 revenue guidance “might help the stock push back to new all-time highs.”

Institutional buying picks up

Blue Zone Wealth Advisors increased its Nvidia stake by 21.4% in the second quarter, bringing its holdings to 129,666 shares valued at roughly $25.9 million. Nvidia now accounts for 4.5% of the firm’s portfolio and is its seventh-largest holding.

Other firms also added exposure. Longfellow Investment Management raised its position by 47.9% in the second quarter, while Spurstone Advisory Services and Phillip James Consulting both initiated new stakes during the period. Institutional investors and hedge funds together own 65.27% of Nvidia’s outstanding stock.

Analysts currently assign Nvidia a consensus price target of $322.61, about 41% above the stock’s Friday opening price. Of the analysts tracked, 48 rate the stock a Buy, two rate it Strong Buy, and four rate it Hold, leaving bullish ratings in a clear majority.

Buyback, dividend, and insider activity

In May, Nvidia’s board authorized an $80 billion share repurchase program, an amount equal to roughly 1.4% of the company’s $5.52 trillion market capitalization. The company also declared a quarterly dividend of $0.25 per share — about 0.4% annualized at the Friday opening price — payable October 1 to shareholders of record on September 10.

Insider selling has continued in the past 90 days, with roughly $410.4 million worth of stock sold, a sum that remains a small fraction of Nvidia’s overall market value. Director Stephen C. Neal sold 15,500 units at an average price of $215.73 in early June, while Director Mark A. Stevens sold 885,000 units at an average of $210.17 in mid-June.

Rosenblatt Securities set the highest price target on Nvidia this week at $390, roughly 71% above the stock’s Friday open. UBS and Jefferies both maintain $300 targets with Buy ratings.

Nvidia’s price-to-earnings ratio is currently 28.82, with a PEG ratio of 0.41 and a beta of 2.23. A PEG below 1 is the rough threshold analysts often cite when a stock’s price has lagged its expected growth — the dynamic Lee is pointing to — while a beta above 2 signals shares that have historically moved more sharply than the broader market.