Nvidia Stock Sank Today. Is It a Buy With Earnings Due Next Week?

May 16, 2026 - 04:49

Nvidia stock took a hit on Tuesday, falling more than 3% as investors locked in profits just days before the company's highly anticipated quarterly earnings report. The dip comes after a strong run that has seen shares climb over 15% in the past month, fueled by optimism around the company's dominance in artificial intelligence chips.

The selloff raises the question: is this a smart entry point or a warning sign? With Nvidia set to report fiscal second-quarter results next week, analysts are split. Some argue the stock's valuation is stretched after a massive rally that has more than doubled its price over the last year. Others point to the company's unshakeable position in the AI hardware market, where demand for its H100 and upcoming Blackwell chips remains insatiable.

Data center revenue, which now makes up the bulk of Nvidia's sales, is expected to show another quarter of triple-digit growth. However, any hint of slowing momentum or supply chain hiccups could trigger a sharper selloff. The broader market's recent volatility, driven by concerns over interest rates and geopolitical tensions, adds another layer of risk.

For long-term investors, the current pullback might look like a discount on a company that is essentially printing money in the AI boom. But for those with a shorter horizon, the earnings report could bring either a windfall or a rude awakening. As always, timing the market around a single event is a gamble. The smart money is watching the guidance more than the headline numbers.