AMD has fallen short of the market’s hopes for its AI business, as Nvidia continues to dominate. There is little sign of that changing, according to Jefferies.

Key Takeaways AMD shares fell Thursday as the chip maker's stock was downgraded by Jefferies analysts.The analysts said they expect the performance gap between AMD's latest products and Nvidia's to widen.

Shockingly, based on the trailing price-to-earnings multiple for both companies, AMD's shares are far more expensive. The stock has a P/E of 106, while Nvidia's is much lower at 40. So not only is Nvidia the dominant AI processor company, but its shares are also relatively cheaper, easily making Nvidia the better AI stock to own in this matchup.