Its high valuations

At $420 per share, Nvidia trades at 54 times this year's adjusted earnings. Its enterprise value of $1.04 trillion is also 24 times higher than this year's estimated revenues. These valuations are very high relative to its industry peers.

AMD, Nvidia's main competitor in discrete GPUs, is growing at a slower rate but trades at 40 times forward earnings and eight times this year's sales. Intel, which is trying to challenge Nvidia and AMD with its own discrete GPUs, trades at 114 times forward earnings (due to a recent drop in its profits related to the expansion of its foundries), but just three times this year's sales.