📉 The Truth Behind NVIDIA's $205: Value Trap Warning - 2026.06.06

Hello, this is Peanut, your fundamental analyst. Is there anyone sighing over their accounts this weekend morning. Last Friday night, a rather harsh wind blew through our portfolios. Putting emotions aside, let's coldly analyze the current NVIDIA with numbers and facts.

📉 The Meaning of $205, Is It Really a Value Trap?

On June 5, NVIDIA closed at $205, a massive drop of -6.20%. The trading volume exceeded 215.65 million shares. In just one day, over $300 billion in market capitalization evaporated ^[1]. This was the result of Broadcom's custom AI chip demand falling short of market expectations, coupled with concerns over a rate hike within the year as the US added 172,000 nonfarm jobs in May ^[1].

The question we need to ask here is, 'Is this a simple correction, or a crack in the fundamentals?' Recently, a report downgraded NVIDIA's investment rating to 'Hold' ^[2]. It is a fact that Q1 FY27 revenue grew by 85% and EPS increased by over 100%. Looking only at the forward P/E of 21x, it might still seem cheap. However, considering execution risks such as delays in data center infrastructure buildouts, is the current valuation assumption verifiable. Due to infrastructure bottlenecks, there is a risk of being trapped in a range-bound market for a while ^[2].

Furthermore, there was a disclosure that Alta Capital Management sold 88,783 shares of NVIDIA. The fact that it is becoming a candidate for institutional profit-taking trimming definitely requires caution. Short to medium-term swing. Presenting a bearish scenario once even in a bullish atmosphere is always my trademark, as you know.

💼 Jensen Huang's 4 Gifts, Conditions for a Rosy Future

Of course, the positive narrative remains. Jensen Huang brought out '4 big gifts' during his visit to Korea ^[4]. The next-generation AI accelerator Vera Rubin, the self-designed Vera CPU, the first AI notebook lineup RTX Spark, and the Jetson Thor supercomputer for physical AI are the main characters ^[4]. He also revealed a strong plan to build an AI R&D center in Seoul ^[5].

The picture of leading the physical AI hegemony war through Isaac Sim, which trains robots in a virtual space, is very attractive ^[3]. However, it takes time for this massive ecosystem expansion to be proven by numbers. Right now, there are even concerns about capacity reduction in some products due to a memory shortage. Can the supply chain support this grand vision with speed.

🛑 Peanut's View

The market is always more ruthless than we imagine. Rather than blind optimism, this is a time that requires a conservative approach to hedge risks. Peanut views that while the current forward P/E of 21x looks cheap considering the growth potential, in the face of infrastructure bottlenecks and macro volatility, we must respond while keeping the possibility of a value trap open.

I will return with a cool-headed perspective next week. Have a good weekend.

📰 Reference News (3)

1

US Chip Stocks Crash... Nvidia and Others Lose 2,000 Trillion Won in Market Cap Overnight - v.daum.net

v.daum.net · 2026.06.06

📰 View original

2

Nvidia: Downgrade To Hold As Earnings Fail To Push Price Higher (NASDAQ:NVDA) - Seeking Alpha

Seeking Alpha · 2026.06.06

📰 View original

3

[Tech Talk Note] Training Robots in a Virtual World... Nvidia Isaac Sim - v.daum.net

v.daum.net · 2026.06.06

📰 View original

📺 Reference Videos (2)

4

YouTube

Korea-Nvidia Physical AI Partnership Opportunities (feat. Dazaifu, Japan) [Quick Analysis]

▶경제 읽어주는 남자(김광석TV)·2026.06.06

5

YouTube

[Editor's Pick] Nvidia AI Tech Center to be Established in Korea... Jensen Huang Says "Seoul is Highly Likely" / YTN

▶ YTN·2026.06.06