Chip stocks' longest losing streak since 2008: is Nvidia a buy?

The sell-off unfolded over two weeks, with the PHLX Semiconductor Index posting its longest daily losing streak since October 2008. Nvidia held up better than the index but still gave up about 10% from a record close, as worries over interest rate hikes, AI project financing and competition weighed on chip stocks worldwide.

Six prior eight-session streaks have occurred since Nvidia began trading in 1999. Nvidia rose a year later in four of them and fell in two, but the two declines came before deeper chip downturns, while the biggest gains followed streaks that ended late in downturns. The streak by itself offered little signal.

Nvidia's recent results: fiscal second-quarter revenue surged 106% year over year to $96.2 billion, and management guided fiscal third-quarter revenue to $108 billion, plus or minus 2%, which at the midpoint implies around 89% growth. At roughly 14 times expected fiscal 2028 earnings, the stock is worth a look, though buying in stages over a few months may be wiser given how the two early streaks played out.