Nvidia Stock Is Rising as Capex Is No Longer King -- Barrons.com

By Callum Keown

Nvidia investors were likely hoping for more artificial-intelligence spending from Meta and Microsoft but the stock was still showing signs of life early Thursday.

The shares, down 5% this month, were pointing 2.2% higher at $194.19 ahead of the open. Its peers were rising, toointc -- Intel was up 3.9% up and Advanced Micro Devices was up 4.8%.

Heading into earnings season, bumper Big Tech capex spending was seen as being crucial for semiconductor stocks. But the market isn't making a great deal of sense right now.

Microsoft opted to hold its capex spending steady for the calendar year 2026, a rare example of restraint from a tech giant, which is being rewarded by investors. Meta only raised the lower end of its forecast, now expecting to spend $130 billion to $145 billion, up from $125 billion to $145 billion.

In contrast, Alphabet hiked its capex spending to between $195 billion and $205 billion from a range of $180 billion to $190 billion. Google stock was punished accordingly.

But the chip sector hasn't conformed to expectations. The PHLX Semiconductor Index (SOX) has fallen for five straight days since Alphabet's capex guidance.

Now it may snap that losing streak following Meta and Microsoft's relative discipline.

For Nvidia, it may not be about Big Tech earnings or AI spending at all.

The stock is looking so cheap right now -- its forward price to earnings of ratio of 17.53 times is its lowest since April 1, 2015, according to Dow Jones Market Data. It's only a matter of time before it starts moving higher again.

Write to Callum Keown at callum.keown@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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July 30, 2026 08:16 ET (12:16 GMT)