Key Takeaways
- Nvidia stock is up 13.4% this year to $214.13 as of October 16, even after Q2 revenue more than doubled to $96 billion.
- The mean Street target of $328.72 sits 53.5% above the close; 49 analysts rate the stock a Buy, 10 an Outperform, 2 a Hold and 1 a Sell, with 1 No Opinion.
- My model lands at $436.49 by January 2031, a 103.8% total return, or 18.0% a year.
- Q3 results land November 17, against a $108 billion revenue guide.
NVIDIA (NVDA) stock is up 13.4% since early January, closing at $214.13 on October 16, after a $96.2 billion second quarter and a guide for about 70% revenue growth in fiscal 2028.
Nvidia stock hit its 2026 closing high of $239.24 on October 6. By October 16, it was down 6.2% from its September 30 close of $228.38, including a 6.6% drop during the week of October 12 by my math, when the PHLX Semiconductor Index fell more than 11%. Reuters tied the AI selloff to rate-hike bets after hot inflation data and to the $50 billion debt load at CoreWeave, a cloud provider Nvidia backs.
Nvidia Doubled Revenue and Guided a Year Out
Nvidia stock drifted between the high $170s and low $190s through March, slid to the mid-$160s in early April, then climbed to the mid-$230s by mid-May. The summer was a range, with the stock trading between the low $190s and the mid-$220s into late August.
Then came the August 26 report:
- Revenue reached $96 billion, more than double a year earlier, and data center revenue rose 18% from the prior quarter to $89 billion.
- Adjusted EPS of $2.22 beat the $2.10 analysts expected, according to LSEG data.
- Management guided Q3 revenue to $108 billion, plus or minus 2%, and set an approximate 70% growth target for fiscal 2028 that CFO Colette Kress called supply-constrained.
- Gross margin is the cost of that growth: Kress guided to 74% in Q3 and a bottom of 71% to 72% in Q4, as memory prices rose faster than Nvidia expected.
On September 28, Nvidia added $150 billion to its buyback, lifting the total authorization to $235 billion through fiscal 2028. That total is 9.0 times the record $26 billion Nvidia returned to shareholders in Q2. By early October, Nvidia stock had reached its high for the year.
Nvidia Meets the AI Financing Question
The week of October 12 changed the conversation. A hotter core inflation reading on October 14 briefly pushed bets on a Fed rate hike this month to roughly 50%, up from roughly 25%, according to Reuters. The same day, CoreWeave (CRWV) stock fell 15.5%. It ended the week down nearly 25% as yields on its bonds pushed past 16%.
That matters for Nvidia because the two are tied together. Nvidia is CoreWeave’s second-largest investor, with about a 10% stake, and it has agreed to buy any unsold CoreWeave capacity through April 2032. On October 15, Jensen Huang told reporters in Stockholm that CoreWeave’s financial strength was improving and that he saw no need for Nvidia to backstop it. The PHLX Semiconductor Index still fell for eight straight sessions, and Nvidia stock closed the week at $214.13 after a 1.43% drop on October 16.
Nvidia saw this argument coming. “We know some will call this circular financing. We see it differently,” Kress said on the Q2 fiscal 2027 earnings call. She put the AI labs Nvidia supports with its balance sheet at roughly a quarter of next year’s business. Nvidia has already invested nearly $50 billion in frontier labs.
Wall Street Barely Touched Its Nvidia Targets
Analysts didn’t follow the stock down. The mean target edged from $327.70 on September 30 to $328.72 on October 16, so the gap to the close widened from 43.5% to 53.5%. Over the past year, the mean rose 50.0% while the stock gained 15.0%. The current split is 49 Buys, 10 Outperforms, 2 Holds, 1 No Opinion and 1 Sell, with Holds down from 4 a year ago. Separately, 59 analysts publish a price target, and even the lowest, $180.00, sits only 15.9% below the close.
Does Nvidia Stock Still Work at 60% Growth?
The guide says about 70% growth in fiscal 2028. I didn’t use it. The labs Nvidia backs are set to be roughly a quarter of next year’s business, and neocloud debt is under strain, so I cut fiscal 2028 growth to 60% and faded it to 10.0% by fiscal 2032. That works out to 33.5% a year, about half of last year’s 65.5%. I also held the EBIT margin at 63.0% after the memory-driven reset, which puts net income margin at 52.3%, under last year’s 56.9%. And I kept the multiple at 15.0x, which lets the P/E shrink 10.9% a year after a 25.8% drop over the past year.
Those cuts still get Nvidia stock to $436.49 by January 2031, a 103.8% total return from $214.13, or 18.0% a year. That’s 32.8% above the Street’s mean and 34.0% below the $661 mid case TIKR published in September. Even the low case lands at $377.64, or 14.1% a year. My model doesn’t need the 70% guide to hold. It needs EPS growth near 34.9% a year and the share-count cuts I assumed. Nvidia expects to execute its $235 billion total authorization through fiscal 2028, and repurchases beyond that remain an assumption.
The November 17 Number Nvidia Holders Need
Nvidia reports Q3 on November 17, and two lines will show whether the financing scare reached the order book. Revenue needs to land near the $108 billion guide, and gross margin near 74%. The bigger tell is fiscal 2028. If Kress reaffirms about 70% growth with the lab and neocloud financing intact, the 60.0% I modeled looks too cautious and the $436.49 target looks conservative. If the guide slips toward 60%, my cautious case becomes the base case, with no cushion left for a deeper cut.
Think I cut Nvidia’s growth too hard, or not hard enough? Run your own numbers: TIKR’s valuation model starts from consensus estimates, takes about 60 seconds and is free. Learn more here.
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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 of the stocks mentioned. Thank you for reading, and happy investing!
