Nvidia’s Forward P/E Hits 14-Year Low as Huang’s Exit Sends Shares Tumbling

Nvidia's forward price-to-earnings (P/E) ratio has plummeted to 12 times, marking its lowest level in 14 years. This decline coincides with a sharp drop in the company's share price following CEO Jensen Huang's sudden resignation. The P/E ratio is determined using projected earnings per share (EPS), as opposed to historical earnings.

On November 12, Nvidia shares closed down 4.34% at $166.19 on the New York Stock Exchange, experiencing a 14.3% plunge from the previous close, which reduced its market capitalization by $602 billion—its lowest since June 2025. The stock also hit a seven-month low on a closing-price basis, since March 30, marking a 30.5% decline from its record high of $239.24 on October 6.

Nvidia's market capitalization has fallen by approximately $1.76 trillion, while investor sentiment has deteriorated significantly after Huang's departure amid scandalous allegations. The board appointed CFO Colette Kress as interim CEO, initiating a search for a permanent successor. For a brief moment, Nvidia lost its position as the world's second-largest company by market capitalization to Microsoft.

However, late-session buying helped it regain its No. 2 ranking, though this was a decline of around $182 billion from the previous day. Retail investor activity was intense, with five buy orders for every sell order, totaling approximately $90 billion in trading value—about one-third of the total trading value across the S&P 500.

Although Wall Street analysts have taken a cautious approach, with Evercore ISI downgrading Nvidia's rating to In Line and slashing its price target by 60%, the market remains focused on the upcoming earnings announcement on November 17, where revenue is expected to rise 92% year over year, and net income is anticipated to exceed $60 billion, up around 89% from the previous year.