Nvidia's Winning Streak May Be Ending

Nvidia's stock has been on a tear, but history suggests its winning streak may be coming to an end. As of July, the company's shares were up just 20% for the year, a relatively modest gain compared to previous years.

The chipmaker has a long history of delivering strong performance, with its stock more than doubling in 2021 after ChatGPT was released and Nvidia's graphics processing units became the gold standard for generative AI. However, data suggests that most of the company's price action occurs in the first seven months of the year.

Nvidia's fiscal 2027 second quarter revenue guidance is for a 95% increase year over year, but even if it beats expectations, the market's reaction may be muted given its already high valuation. The stock has been slowing down despite accelerating business growth, and Wall Street is being cautious in its recommendations.