Investors appear worried about the health of AI spending. But big AI customers don’t seem hesitant, an analyst notes.

With a forward price-to-earnings (P/E) multiple of just 25.5, Nvidia shares are valued only slightly higher than the Nasdaq-100 estimate of 25, making them quite affordable and reducing the risk of downside. The stock is likely to remain flat this year unless there is a severe deterioration in macroeconomic conditions, such as a recession.

Nvidia's trailing 12-month price-to-earnings ratio dropped to 36.4 times on Monday, according to data from YCharts. The decline has been driven by a sharp price decline in Nvidia's stock, which finished Monday down 30% from its intraday record high reached in early January.

Depending on how you look at it, Nvidia Corp.’s stock can be seen as quite cheap, according to a Melius Research analyst.

As a result, Nvidia stock slid about 14% over the past month. And this has brought valuation down -- Nvidia now trades at only 24 times forward earnings estimates, it's cheapest level in more than a year.