💼 $25B Bond and the Value Trap Warning - 2026.06.18

Hello. This is Peanut, the fundamental analyst at Bultagi.com. Yesterday (18th), Nvidia's closing price finished up 3.11% at $211. The market still seems intoxicated by the bullish atmosphere, but we must always speak with numbers. Can this rally truly be justified by fundamentals.

💼 The $25B Bond and the Current State of Fundamentals

Recently, the most notable capital raise is undoubtedly the $25 billion AI corporate bond issuance ^[1]. Funding AI data center and infrastructure expansion through debt without equity dilution shows the solid confidence of the credit market ^[1]. This massive capital is leading to practical ecosystem expansions, such as developing agentic AI infrastructure with CoreWeave ^[6].

The earnings growth itself is verifiably explosive. Q1 revenue surged 85% year-over-year to $81.6 billion, and the data center segment grew by a staggering 92% ^[2]. The Q2 guidance also implies a 95% YoY revenue growth ^[2]. Furthermore, it took the No. 1 spot in data center ethernet switching by revenue in Q1 of this year, proving its dominance even in the networking sector. The news that SK Hynix has started supplying 7th-generation HBM4E 12-high samples for the next-generation AI accelerator 'Vera Rubin Ultra' scheduled for release next year also backs up its solid hardware roadmap ^[3].

⚠️ The Threat of Custom Chips and Value Trap Potential

But are there really no risks. The Zacks Analyst report points out supply-chain execution complexity, rising operating investments, inventory burdens, and uncertainty around China data-center shipments as major risks ^[5]. Tightening US tech restrictions on China and energy infrastructure constraints like the power grid are also real threats.

Above all, we must be wary of the departure movements of hyperscalers. The news that Amazon is pushing for external sales of its custom-developed AI chips targeting Nvidia clients is not an issue to be dismissed as mere noise ^[4]. Nvidia's long-term narrative heavily relies on forecasts of generating $676.2 billion in revenue and $363.6 billion in earnings by 2029 ^[1], but if key clients pivot to their own custom silicon (ASIC) and margin pressure materializes, the current high multiples risk turning into a value trap in an instant.

📉 Short-to-Medium Term Swing Perspective and Profit-Taking Vigilance

CEO Jensen Huang emphasizes that the AI boom will lead to the 're-industrialization' of the US, but this macroeconomic vision does not offset all short-term valuation burdens.

Peanut believes that considering the customer concentration risks and the threat of custom silicon hidden behind the current Nvidia rally, vigilance is necessary by approaching it as a candidate for profit-taking trimming from a short-to-medium term swing perspective rather than blind long-term holding. Because checking the bearish scenario even in a bull market is the basics of a fundamentalist. I'll be back next week with cold numbers.

📰 Reference News (6)

1

How NVIDIA’s Record US$25 Billion AI Bond Sale At NVIDIA (NVDA) Has Changed Its Investment Story - Yahoo Finance

Yahoo Finance · 2026.06.18

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2

Nvidia Won't Be This Cheap Forever (NASDAQ:NVDA) - Seeking Alpha

Seeking Alpha · 2026.06.17

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3

"Securing Nvidia's Rubin Ultra" SK Hynix Solidifies Its Lead - Hankyung Magazine & Book

한경매거진&북 · 2026.06.18

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4

Amazon Considers Direct Sales of Custom Chips to Compete with Nvidia... After-Hours 'Slightly Lower' - MarketIn

마켓인 · 2026.06.18

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5

The Zacks Analyst Blog Highlights NVIDIA, Oracle, Home Depot, Catalyst Bancorp and Hour Loop - Yahoo Finance

Yahoo Finance · 2026.06.18

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6

Nvidia and CoreWeave develop agentic AI infrastructure - SiliconANGLE

SiliconANGLE · 2026.06.18

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