However, in addition to its prospects above, Nvidia stock is also surprisingly cheap after the recent pullback. It now trades at a forward price-to-earnings (P/E) ratio of just 24, which is comparable to the S&P 500 's forward P/E of 20.7.

Nvidia (NVDA) and chip stocks led a Nasdaq rebound in early morning trading on Wednesday. The Nasdaq Composite index gained more than 1% in early morning trading, following a February CPI report showing that inflation slowed more than expected last month.

Nvidia stock rose Wednesday as it continued to pare back some of its recent losses—but more big swings could be ahead.Shares in the chip maker rose 6.4% to $115.74, having closed the previous session up 1.