Key Stats for Nvidia Stock
- Current Price: $228.86
- Target Price (Mid): ~$670
- Street Target: ~$328
- Potential Total Return: ~193%
- Annualized IRR: ~28% / year
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What Happened?
NVIDIA (NVDA) added $150 billion to its share buyback program on September 28, lifting the remaining authorization to $235 billion in what the company called the largest share repurchase authorization increase in history. The stock closed up 1.68% at $228.86, bucking a decline in other AI stocks on a day Nvidia also launched an AI agent safety platform.
The $235 billion equals about 4% of Nvidia’s $5.5 trillion market value. NVIDIA’s investor relations materials set the window through fiscal 2028, and meeting it depends on free cash flow recovering from a fiscal Q2 in which it fell 56% from the prior quarter.
Full Pace Means About $44 Billion of Buybacks a Quarter
Fiscal 2028 ends January 30, 2028, so using the full authorization by then works out to roughly $15 billion a month, or about $44 billion a quarter. In fiscal Q2 2027, Nvidia spent $19.7 billion on repurchases, about $6.6 billion a month. NVIDIA’s figures imply about $14 billion of repurchases from July 27 through September 28, since about $99 billion remained after Q2, and the $150 billion increase left $235 billion.
Dividends add about $6 billion a quarter at the $0.25 quarterly rate, so full-pace buybacks plus dividends would need roughly $50 billion a quarter. NVIDIA’s best free cash flow quarter of the five through July 2026 was $48.6 billion, in fiscal Q1 2027, per TIKR.
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Q2 Cash Returns Ran Ahead of Free Cash Flow
In fiscal Q2 2027, buybacks plus $6.0 billion of dividends totaled $25.8 billion in cash, above the free cash flow of $21.4 billion. That free cash flow missed the Street’s $47.5 billion estimate by 55%, per TIKR.
Across fiscal 2027’s first half, free cash flow of $70.0 billion covered $45.3 billion of buybacks and dividends. NVIDIA also put a net $35.2 billion into equity securities and raised $24.9 billion of debt. It ended July 26 with $56.6 billion in cash and debt securities against $33.4 billion of debt.
Receivables absorbed $22.3 billion of Q2 operating cash, and Nvidia’s 10-Q attributes their rise to extended payment terms on large multi-quarter agreements with certain investment-grade customers.
The Plan Assumes Consensus Cash Shows Up
TIKR’s consensus data puts fiscal 2027 free cash flow around $194 billion, which implies around $124 billion in the second half, about 1.8 times the first half. Fiscal 2028 consensus of around $324 billion alone exceeds the full $235 billion authorization.
Jensen Huang, Nvidia’s founder and CEO, tied the buyback to that trajectory. “We’re going to generate a lot of cash in the coming years, and every single year, as we generate more cash, we’d like to be able to return it back to shareholders,” he told CNBC on September 28. That makes the $235 billion a ceiling whose pace depends on cash, not a fixed purchase schedule.
At the Goldman Sachs Communacopia + Technology Conference on September 10, Huang pointed to one source of Nvidia’s demand: “$400 billion of VC funding went into AI natives in the last 6 months.” He did not cite a source for the figure. That ties part of the cash behind the buyback to startups’ ability to keep raising money.
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TIKR Advanced Model Analysis
- Current Price: $228.86
- Target Price (Mid): ~$670
- Potential Total Return: ~193%
- Annualized IRR: ~28% / year
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TIKR’s mid case projects around $670 per share by January 31, 2031, a ~193% total return, or ~28% a year from $228.86.
Over the model’s full forecast, which runs past 2031, the mid case assumes a revenue CAGR around 28% and a net margin near 53%, down from 56.9% over the past year. That growth depends on demand beyond the largest clouds, including AI-native startups and regional builds like the 2 gigawatts planned in Australia for 2027, which Huang put at $80 billion. The margin driver is gross margin, which management guided to 71% to 72% for the January 2027 quarter.
If free cash flow meets consensus, buybacks can run near full pace. The primary risk is another quarter like Q2, when cash returns outran free cash flow, which would slow repurchases and leave earnings growth to carry the stock alone.
Conclusion
NVIDIA’s fiscal Q3 report, expected in November, will show repurchases through late October. A pace well short of $44 billion a quarter, or cash returns again topping free cash flow, would show the authorization running ahead of execution. Buybacks near that pace in the fiscal Q4 report, expected in early 2027, would put the plan on track.
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Should You Invest in Nvidia?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
