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Egerton Capital UK LLP lifted its holdings in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 27.8% during the second quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 3,417,950 shares of the computer hardware maker’s stock after buying an additional 742,932 shares during the quarter. NVIDIA accounts for 6.6% of Egerton Capital UK LLP’s portfolio, making the stock its 6th biggest holding. Egerton Capital UK LLP’s holdings in NVIDIA were worth $683,898,000 as of its most recent SEC filing.

A number of other institutional investors and hedge funds have also recently bought and sold shares of the business. Boyd Wealth Management LLC raised its position in shares of NVIDIA by 273.4% during the 2nd quarter. Boyd Wealth Management LLC now owns 9,145 shares of the computer hardware maker’s stock worth $1,830,000 after purchasing an additional 6,696 shares during the last quarter. Diversified Enterprises LLC lifted its holdings in NVIDIA by 44.2% in the 4th quarter. Diversified Enterprises LLC now owns 127,604 shares of the computer hardware maker’s stock valued at $23,798,000 after purchasing an additional 39,129 shares in the last quarter. Altshuler Shaham Ltd boosted its stake in shares of NVIDIA by 6,451.9% during the 1st quarter. Altshuler Shaham Ltd now owns 637,236 shares of the computer hardware maker’s stock worth $111,134,000 after purchasing an additional 627,510 shares during the last quarter. ASR Vermogensbeheer N.V. raised its position in shares of NVIDIA by 1.8% in the fourth quarter. ASR Vermogensbeheer N.V. now owns 3,169,377 shares of the computer hardware maker’s stock valued at $591,086,000 after buying an additional 54,877 shares during the last quarter. Finally, Storen Legacy Partners LLC acquired a new position in shares of NVIDIA in the fourth quarter valued at approximately $1,350,000. Institutional investors and hedge funds own 65.27% of the company’s stock.

NVIDIA Price Performance NVDA stock opened at $225.73 on Wednesday. The stock has a 50-day moving average price of $211.83 and a two-hundred day moving average price of $202.77. NVIDIA Corporation has a 12-month low of $164.27 and a 12-month high of $236.54. The company has a current ratio of 4.59, a quick ratio of 3.85 and a debt-to-equity ratio of 0.14. The company has a market cap of $5.44 trillion, a PE ratio of 28.54, a price-to-earnings-growth ratio of 1.81 and a beta of 2.22.

NVIDIA (NASDAQ:NVDA – Get Free Report) last announced its quarterly earnings results on Wednesday, August 26th. The computer hardware maker reported $2.22 EPS for the quarter, topping the consensus estimate of $2.09 by $0.13. The company had revenue of $96.22 billion during the quarter, compared to analyst estimates of $92.27 billion. NVIDIA had a return on equity of 96.04% and a net margin of 63.66%.The firm’s revenue was up 105.9% on a year-over-year basis. During the same period in the prior year, the firm posted $1.05 earnings per share. As a group, research analysts predict that NVIDIA Corporation will post 9.1 EPS for the current year. NVIDIA declared that its Board of Directors has approved a stock repurchase program on Wednesday, May 20th that authorizes the company to buyback $80.00 billion in outstanding shares. This buyback authorization authorizes the computer hardware maker to reacquire up to 1.5% of its shares through open market purchases. Shares buyback programs are usually a sign that the company’s board believes its stock is undervalued.

NVIDIA Dividend Announcement The business also recently announced a quarterly dividend, which will be paid on Thursday, October 1st. Stockholders of record on Thursday, September 10th will be paid a $0.25 dividend. The ex-dividend date is Thursday, September 10th. This represents a $1.00 dividend on an annualized basis and a dividend yield of 0.4%. NVIDIA’s dividend payout ratio (DPR) is 12.64%.

Insider Activity In other NVIDIA news, EVP Timothy Teter sold 30,000 shares of the stock in a transaction that occurred on Monday, August 31st. The shares were sold at an average price of $217.88, for a total value of $6,536,400.00. Following the completion of the sale, the executive vice president owned 2,687,660 shares of the company’s stock, valued at $585,587,360.80. This trade represents a 1.10% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Mark Stevens sold 622,239 shares of the firm’s stock in a transaction on Friday, September 4th. The shares were sold at an average price of $231.62, for a total transaction of $144,122,997.18. Following the sale, the director directly owned 2,336,531 shares of the company’s stock, valued at approximately $541,187,310.22. The trade was a 21.03% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 2,585,740 shares of company stock worth $571,015,527. Company insiders own 3.94% of the company’s stock.

NVIDIA News Summary Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: NVIDIA continues to benefit from exceptional AI infrastructure demand. Recent analysis highlighted $96.2 billion in quarterly revenue, 106% year-over-year growth, strong data-center momentum and management’s expectation for approximately 70% revenue growth in fiscal 2028. Blackwell, networking and the upcoming Vera Rubin platform provide additional product catalysts. Nvidia’s Earnings Staircase Keeps The Momentum Rolling Positive Sentiment: CEO Jensen Huang reinforced the investment case by describing NVIDIA’s computing hardware as durable, rentable and capable of generating revenue for customers even as chips age. Continued rental demand for older H100 systems supports the resale and utilization value of NVIDIA’s installed base. Jensen Huang Calls Nvidia Chips a Revenue-Generating Asset Positive Sentiment: Customer and ecosystem news remains supportive: NVIDIA-backed Firmus signed a multiyear computing-capacity agreement with OpenAI, while Quantum Cyber announced an eight-GPU NVIDIA A100 cluster for autonomous defense and drone applications. These announcements indicate expanding use of NVIDIA hardware beyond traditional hyperscale deployments. Nvidia-backed Firmus Signs Deal With OpenAI Neutral Sentiment: NVIDIA’s approximately $12.9 billion acquisition of Hugging Face is viewed as a way to deepen its software and developer ecosystem, but investors are watching whether the open-source community embraces the platform under NVIDIA ownership and whether the deal produces adequate returns. Neutral Sentiment: Supplier activity points to sustained demand but also rising execution and financing requirements. Wistron announced a $1.5 billion share sale to fund materials and capacity, illustrating the capital intensity of the AI-server buildout without directly changing NVIDIA’s earnings outlook. Negative Sentiment: Director Mark Stevens sold 1,022,239 NVIDIA shares for approximately $235.6 million across September 3–4, reducing his direct ownership by roughly one-third across the reported transactions. Although insider sales do not necessarily signal deteriorating fundamentals, the size of the sales can weigh on sentiment. Negative Sentiment: The stock’s pullback reflects profit-taking after three sessions of gains and weaker risk appetite linked to higher oil prices and renewed Middle East tensions. Investors also continue to debate competition from custom AI chips, data-center opposition, customer concentration and whether AI spending can justify NVIDIA’s multitrillion-dollar valuation. Wall Street Analyst Weigh In A number of brokerages recently issued reports on NVDA. CICC Research raised their target price on shares of NVIDIA from $240.60 to $268.30 and gave the stock an “outperform” rating in a research report on Friday, May 22nd. William Blair reiterated an “outperform” rating on shares of NVIDIA in a report on Tuesday, June 2nd. Evercore set a $465.00 price target on NVIDIA and gave the stock an “outperform” rating in a research note on Thursday, August 27th. Deutsche Bank Aktiengesellschaft restated a “buy” rating on shares of NVIDIA in a report on Monday, August 31st. Finally, Weiss Ratings reaffirmed a “buy (b)” rating on shares of NVIDIA in a research report on Wednesday, July 8th. Two analysts have rated the stock with a Strong Buy rating, fifty have issued a Buy rating and three have assigned a Hold rating to the company. According to data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus price target of $324.83.

View Our Latest Stock Report on NVIDIA

NVIDIA Company Profile (Free Report)

NVIDIA Corporation is a technology company that designs accelerated computing platforms, graphics processors and related software. Its products are used for artificial intelligence, machine learning, high-performance computing, computer graphics, data-center applications and other workloads that benefit from parallel processing.

The company’s offerings include GeForce graphics processing units (GPUs) and software for gaming and personal computers; data-center GPUs, systems and networking products; and professional visualization solutions for design, engineering, media and scientific applications.

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Nvidia stock fell about 1.5% on Tuesday to around $227, taking a breather after three consecutive sessions of gains as broader markets came under pressure from rising oil prices and renewed Middle East tensions.

The pullback was notable because several major semiconductor stocks moved higher.

Intel surged more than 8% after Northland Capital Markets analyst Gus Richard upgraded the stock to Outperform from Market Perform.

AMD gained about 5%, while Broadcom rose roughly 3%. The PHLX Semiconductor Sector index was also up around 2%.

The broader market moved in the opposite direction. The Dow Jones Industrial Average fell 574 points, or 1.1%, while the S&P 500 declined 0.4% and the Nasdaq Composite slipped 0.3%.

US markets were closed on Monday for the Labor Day holiday.

Oil prices remained a key source of pressure for equities on Tuesday as West Texas Intermediate crude futures rose for a sixth consecutive session, extending their longest winning streak since March.

Brent crude was trading around $98 a barrel as tensions between the US and Iran escalated over the weekend.

Against that backdrop, Nvidia’s decline comes after a strong run over recent months.

The stock is up about 24% over the past six months and remains just below its record high of $236.54.

However, Nvidia has significantly underperformed some semiconductor peers over the same period, with both AMD and Intel gaining more than 100%.

Cantor maintains $350 Nvidia targetCantor Fitzgerald reiterated its Overweight rating on Nvidia and maintained a $350 price target.

The firm highlighted continued demand for AI infrastructure while acknowledging supply constraints across the semiconductor industry.

Analyst C.J. Muse said investors remain divided over the durability of the AI investment cycle as macroeconomic and debt concerns weigh on markets.

Cantor also emphasized Nvidia’s position as TSMC’s largest customer and argued that the stock trades at the cheapest valuation among compute companies based on calendar 2028 earnings estimates.

The firm also believes Nvidia remains under-owned by both hedge funds and long-only investors.

Muse addressed Nvidia’s high-bandwidth memory specifications, characterizing HBM de-specification as an economic decision aimed at optimizing gross margins and GPU sales around a finite number of bits.

Earlier this month, Morningstar raised its fair value estimate to $310 from $280, implying roughly 30% upside from the stock’s current level.

Nvidia reported $96 billion in fiscal second-quarter revenue, up 106% from a year earlier and above its $91 billion guidance.

The company expects October-quarter revenue of $108 billion, ahead of FactSet consensus of $105 billion.

Morningstar identified Nvidia’s fiscal 2028 outlook as the most significant part of the earnings report.

Nvidia expects revenue growth of 70% next year, implying nearly $700 billion in total revenue compared with Morningstar and FactSet estimates of roughly $570 billion.

The outlook reinforces the longer-term bullish case, even as Nvidia’s shares pause after their recent gains.

There's no shortage of naysayers when it comes to Nvidia (NVDA -2.01%). Just 1.18% of its outstanding shares are currently being shorted, but think about what that means for a company with a market cap just above $5.5 trillion.

There are nearly $57 billion in short positions out there, and that doesn't include put options, bearish ETFs, or other derivative activity. The actual number of shares sold short has actually increased 40% over the past year, and the value of those bearish wagers has risen another 35% on top of that.

The bears are everywhere, but I see that as more of an opportunity than a threat. Let's go over some of the knocks on Nvidia. I want to counter by pointing out what the worrywarts might be missing.

Image source: Getty Images.

1. Nvidia is priced for perfection There is nothing that I love more than when a bear argues that a stock is "priced for perfection." The assumption is that current expectations are too high and that the stock is bumping up against the ceiling, with so much air below it on the way down to the floor.

Last month's fiscal second quarter was a perfect example of Nvidia stock perpetually scaling the wall of worry. Bears were banking on analysts aiming too high by targeting 97% in top-line growth. It would be the fourth consecutive quarter of accelerating year-over-year growth.

How is that possible with a company as large as Nvidia? Expectations were high. Reality was kinder. Here's a look at the company's top-line growth:

Q2 FY 2026: 56% Q3 FY 2026: 63% Q4 FY 2026: 73% Q1 FY 2027: 85% Q2 FY 2027: 106% The late-August financial update gets even better. Those same analysts tagged by bears as overly ambitious are serial lowballers. They projected revenue would decelerate sharply to just 45% for fiscal year 2028, which starts in February. Nvidia shattered those crystal balls two weeks ago by forecasting 70% growth for next year.

Perfection isn't the ceiling. Market winners thrive in the debunking process.

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2. Rivals will gain market share at Nvidia's expense It would be naive for a bull like me to assume that Nvidia will be the king of the hill forever. Competitive advantages can weaken over time, just as they have been strengthening for years. A disruptor can pioneer a better mousetrap for the AI revolution or whatever giant tech trend comes next.

The one thing that's fair to say is that it's not happening now. Let's have Advanced Micro Devices (AMD +5.90%) enter the chat. AMD has a colorful history of needling the market leader, and it's certainly cashing in on the AI boom Nvidia is championing.

AMD stock has outperformed Nvidia over the past year by more than tripling. However, in its latest quarter -- and I'll point out that their fiscal quarters ended about a month apart -- AMD's overall revenue rose just 50%, half of Nvidia's top-line growth.

I'll beat the bears to what they're thinking. Zoom in on AMD's data center business, which now accounts for more than half (58%) of its revenue, and that business skyrocketed 107% for the quarter. That's awesome, but Nvidia's data center revenue, which accounts for 93% of its results, soared 117%.

In the end, AMD's data center business delivered $3.5 billion in incremental revenue compared to a year earlier. Nvidia tacked on $48 billion in incremental data center revenue.

3. Margins will inevitably contract Let's close on a margin of error. Nvidia's gross margin was 75% in its latest quarter. The adjusted net margin was a jaw-dropping 56%. It's easy to question the sustainability of those levels. Unlike the flawed "priced for perfection" argument, there is a clear ceiling here: Gross margin will never exceed 100%, and the after-tax adjusted bottom line will naturally be well below that.

The reasonable bear case is that growth may continue but decelerate. Margins will contract, so earnings will grow even slower than the slowing top line -- if not eventually turn into negative year-over-year earnings growth.

Set aside that high bandwidth memory (HBM) makers riding Nvidia's coattails are currently generating gross margins approaching 85%. With competition percolating, Nvidia will need to keep innovating and fortifying its moat. It probably has more pricing flexibility now than the bears think. With third-party HBM becoming a larger cost component in the AI build-out, won't it make it even riskier for a company to bank on non-Nvidia AI chips and accelerators?

In the meantime, you can buy the stock for less than 15 times next year's projected earnings. This is why the bears aren't arguing that Nvidia is too expensive, as it's trading at a discount to the overall market despite growing substantially faster. Nvidia will be volatile, but it's built to win.

powered by

NVDA into Sep 10

Buy NASDAQ:NVDA. The stock is near highs but still “cheap” versus compute peers on 2028 earnings, and Sep 10 is a clear catalyst: Huang’s Goldman fireside chat can push AI demand and next-hardware confidence higher, keeping the market willing to pay up for accelerating earnings. This is a momentum + valuation support setup.

Key Risk: Huang fails to lift growth expectations (enterprise adoption and next-platform demand sound flat), so the “cheap” multiple compresses fast.

Hugging Face deal as a hedge

Buy NASDAQ:NVDA with a focus on the $12.93B Hugging Face angle. If Huang reinforces that Nvidia can broaden beyond hyperscalers via open-weight models and enterprise distribution, the market will price in a more durable revenue stream and less customer concentration risk—secondarily supporting NVDA’s long-term margins and stickiness.

Key Risk: The Hugging Face strategy doesn’t translate into measurable enterprise traction (or the deal faces regulatory/implementation delays), so concentration risk stays unresolved.

Nvidia stock NASDAQ:NVDA is sitting less than 5% below its record high, but the next catalyst arrives on September 10.

Chief executive Jensen Huang will participate in a fireside chat at Goldman Sachs’ Communacopia + Technology Conference at 8:50 a.m. PT, where investors will listen for signals on AI demand, enterprise adoption and Nvidia’s next hardware.

Nvidia closed at $225.73 on Tuesday, down 2.01%, leaving the stock about 4.6% below its $236.54 all-time high.

Nvidia’s shares are close to a record after another AI-driven rally, yet some analysts argue earnings expectations are rising even faster than the stock.

Cantor Fitzgerald analyst C.J. Muse reiterated an Overweight rating and a $350 price target on September 8. Muse said Nvidia trades at the “cheapest” valuation among compute names based on calendar-2028 earnings estimates.

Cantor also argued that Nvidia remains under-owned by hedge funds and long-only managers.

That makes Huang’s appearance more important.

If he reinforces expectations for accelerating revenue or a widening customer base, investors may continue to view Nvidia as inexpensive relative to future earnings.

But that support depends on estimates continuing to rise. If growth expectations flatten, the stock becomes harder to defend.

Nvidia’s next leg depends on proving AI demand is expanding beyond a small group of hyperscalers.

Recent results from Dell strengthened that argument. Dell raised its annual outlook after reporting record revenue and a large AI-server backlog.

D.A. Davidson analyst Gil Luria told MarketWatch that Dell’s results were another sign the enterprise AI-compute market has momentum “beyond the current hyperscaler market.”

They will listen for commentary on enterprise adoption, sovereign AI, supply constraints and Feynman, Nvidia’s next architecture.

A broader customer base would make Nvidia’s growth story more durable.

If AI spending remains concentrated among Microsoft, Amazon, Meta and other technology giants, investors will keep worrying about concentration.

Customer concentration remains the uncomfortable riskThe bullish case has a major weakness, as Nvidia’s latest regulatory filing showed that three direct customers represented 16%, 15% and 13% of total revenue in the first half of fiscal 2027.

Investor Dan Niles highlighted the same issue this week, noting that Nvidia’s largest customers are increasingly designing their own application-specific chips.

That creates an unusual tension: the companies funding Nvidia’s growth also have the strongest incentives to reduce their dependence on its GPUs.

Nvidia’s planned $12.93 billion acquisition of Hugging Face could help address that risk by giving the company access to more than 18 million developers and a stronger route into enterprise AI.

Niles said that open-weight models could eventually dominate LLM usage, allowing Nvidia to sell a broader stack directly to enterprises rather than relying heavily on hyperscalers.

Nvidia Corp‘s (NASDAQ:NVDA) $12.9 billion acquisition of Hugging Face is widely seen as another move to strengthen its position in artificial intelligence. But the bigger opportunity may lie well before AI models ever run on Nvidia’s chips. According to one investor, the deal gives Nvidia a strategic foothold at the very beginning of the AI development process, potentially expanding its influence across a much broader developer ecosystem.

Why Nvidia Bought Hugging FaceWhile Nvidia dominates AI computing, Neostellar Capital principal Willy Lee believes the Hugging Face acquisition is less about owning open-source models and more about shaping how developers build with them.

“The acquisition is less about NVIDIA owning open-source models and more about ensuring that, regardless of which models win, NVIDIA remains deeply embedded in how those models are discovered, customized and ultimately deployed,” Lee said.

He argues the acquisition moves Nvidia upstream in the AI development cycle by giving it “a strategic position much earlier in the developer workflow while also broadening its exposure beyond a relatively concentrated group of frontier labs and hyperscalers.”

That distinction matters because the next wave of AI demand may come from enterprises, startups and developers building specialized applications rather than a handful of well-funded frontier AI labs.

Lee believes open models significantly expand that opportunity by increasing the number of developers and workloads that ultimately require Nvidia’s computing platform.

Read Next

How Hugging Face Strengthens Nvidia AIRather than relying primarily on large AI companies, Lee sees Hugging Face as a way for Nvidia to deepen adoption of its broader software ecosystem as developers move from experimentation to production.

“NVIDIA can use Hugging Face to make CUDA, NIM, NeMo and its broader software stack easier to adopt as developers move from experimentation into production,” he said.

Hendi Susanto, portfolio manager of the GGTL ETF at Gabelli Funds, echoed that view, saying the acquisition “strengthens its software ecosystem by expanding its presence in open-platform AI software and deepening its strategic relationship with the developer community.”

He added that the deal reinforces Nvidia’s competitive moat while providing “a stronger platform to compete against increasingly capable, lower-cost Chinese AI players.”

Management has also pledged to keep Hugging Face open and hardware-agnostic after the acquisition, allowing developers to continue choosing their preferred models, cloud providers and computing platforms.

Nvidia’s latest acquisition suggests the company is looking beyond GPUs to secure its long-term position in AI. If Lee’s thesis proves correct, the real value of Hugging Face won’t be the models it hosts, but its role as the starting point for millions of developers building AI applications—giving Nvidia an opportunity to expand its ecosystem long before computing demand reaches its chips.

Read Next

Imagen: Shutterstock

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Farmers & Merchants Investments Inc. grew its position in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 7.5% in the 2nd quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The firm owned 199,159 shares of the computer hardware maker’s stock after buying an additional 13,817 shares during the quarter. NVIDIA accounts for 1.0% of Farmers & Merchants Investments Inc.’s holdings, making the stock its 25th largest holding. Farmers & Merchants Investments Inc.’s holdings in NVIDIA were worth $39,850,000 at the end of the most recent quarter.

Other hedge funds and other institutional investors have also made changes to their positions in the company. Defender Capital LLC. increased its holdings in NVIDIA by 0.7% during the second quarter. Defender Capital LLC. now owns 7,534 shares of the computer hardware maker’s stock valued at $1,507,000 after buying an additional 50 shares during the period. Spectrum Financial Alliance Ltd LLC raised its stake in NVIDIA by 3.8% in the first quarter. Spectrum Financial Alliance Ltd LLC now owns 1,395 shares of the computer hardware maker’s stock worth $243,000 after buying an additional 51 shares in the last quarter. LMG Wealth Partners LLC lifted its holdings in NVIDIA by 0.7% during the fourth quarter. LMG Wealth Partners LLC now owns 7,649 shares of the computer hardware maker’s stock worth $1,427,000 after buying an additional 53 shares during the period. Vision Financial Markets LLC boosted its position in NVIDIA by 1.2% during the 3rd quarter. Vision Financial Markets LLC now owns 4,640 shares of the computer hardware maker’s stock valued at $866,000 after acquiring an additional 53 shares in the last quarter. Finally, Penobscot Wealth Management boosted its position in NVIDIA by 0.7% during the 1st quarter. Penobscot Wealth Management now owns 7,930 shares of the computer hardware maker’s stock valued at $1,383,000 after acquiring an additional 55 shares in the last quarter. Institutional investors own 65.27% of the company’s stock.

NVIDIA Stock Performance NVIDIA stock opened at $230.36 on Monday. The company has a debt-to-equity ratio of 0.14, a quick ratio of 3.85 and a current ratio of 4.59. The stock has a market cap of $5.55 trillion, a PE ratio of 29.12, a price-to-earnings-growth ratio of 1.81 and a beta of 2.22. The stock has a 50-day moving average of $210.61 and a two-hundred day moving average of $202.19. NVIDIA Corporation has a one year low of $164.07 and a one year high of $236.54.

NVIDIA (NASDAQ:NVDA – Get Free Report) last issued its quarterly earnings results on Wednesday, August 26th. The computer hardware maker reported $2.22 earnings per share for the quarter, topping analysts’ consensus estimates of $2.09 by $0.13. NVIDIA had a return on equity of 96.04% and a net margin of 63.66%.The business had revenue of $96.22 billion for the quarter, compared to analyst estimates of $92.27 billion. During the same quarter in the previous year, the firm earned $1.05 earnings per share. The company’s revenue was up 105.9% on a year-over-year basis. On average, research analysts anticipate that NVIDIA Corporation will post 9.1 EPS for the current fiscal year. NVIDIA declared that its Board of Directors has initiated a stock repurchase program on Wednesday, May 20th that permits the company to repurchase $80.00 billion in shares. This repurchase authorization permits the computer hardware maker to repurchase up to 1.5% of its stock through open market purchases. Stock repurchase programs are typically an indication that the company’s leadership believes its stock is undervalued.

NVIDIA Announces Dividend The business also recently announced a quarterly dividend, which will be paid on Thursday, October 1st. Shareholders of record on Thursday, September 10th will be given a dividend of $0.25 per share. This represents a $1.00 annualized dividend and a yield of 0.4%. The ex-dividend date of this dividend is Thursday, September 10th. NVIDIA’s payout ratio is currently 12.64%.

Insider Activity at NVIDIA In other news, Director Mark Stevens sold 63,501 shares of NVIDIA stock in a transaction on Tuesday, September 1st. The shares were sold at an average price of $220.06, for a total transaction of $13,974,030.06. Following the completion of the sale, the director directly owned 4,558,770 shares in the company, valued at approximately $1,003,202,926.20. The trade was a 1.37% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, EVP Timothy Teter sold 30,000 shares of the business’s stock in a transaction on Monday, August 31st. The shares were sold at an average price of $217.88, for a total transaction of $6,536,400.00. Following the sale, the executive vice president directly owned 2,687,660 shares in the company, valued at $585,587,360.80. This trade represents a 1.10% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 1,563,501 shares of company stock worth $335,380,530. 3.94% of the stock is owned by insiders.

Analyst Upgrades and Downgrades Several research firms have recently commented on NVDA. Morgan Stanley set a $300.00 price target on NVIDIA and gave the stock an “overweight” rating in a research report on Thursday, August 27th. UBS Group set a $300.00 target price on NVIDIA and gave the company a “buy” rating in a research note on Thursday, August 27th. KGI Securities boosted their target price on shares of NVIDIA from $335.00 to $345.00 in a report on Thursday, August 27th. Weiss Ratings reissued a “buy (b)” rating on shares of NVIDIA in a research report on Wednesday, July 8th. Finally, Itau BBA Securities lowered their price target on shares of NVIDIA from $256.00 to $218.00 in a report on Wednesday, June 24th. Two research analysts have rated the stock with a Strong Buy rating, fifty have issued a Buy rating and three have given a Hold rating to the company. According to MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average price target of $324.83.

View Our Latest Research Report on NVIDIA

NVIDIA News Summary Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: Hugging Face expands NVIDIA’s AI ecosystem: The acquisition gives NVIDIA access to Hugging Face’s open-source platform, which hosts millions of models, applications and datasets used by more than 18 million developers. Investors view the deal as a way to deepen CUDA adoption, strengthen NVIDIA’s software moat and position the company as an AI platform provider rather than solely a chip supplier. Management says Hugging Face will remain open to the broader AI ecosystem. Why NVIDIA’s defensive move to acquire Hugging Face is about much more than chips Positive Sentiment: New consumer AI revenue channel: Lenovo and Acer are expected to launch Windows PCs powered by NVIDIA’s RTX Spark chip in October. Local AI processing could expand NVIDIA’s addressable market while reducing reliance on cloud data centers. HP also announced new OmniBook PCs using RTX Spark technology. NVIDIA sets October launch for RTX Spark AI PCs Positive Sentiment: Analyst support and demand remain strong: Needham and Rosenblatt reaffirmed Buy ratings with price targets of $300 and $390, respectively. Recent earnings showed revenue growth above 100%, a 63.7% net margin and results ahead of consensus, while management’s long-term outlook continues to imply robust AI infrastructure spending. NVIDIA’s equity investments in companies such as OpenAI, CoreWeave and Nebius have also grown substantially, reinforcing its influence across the AI supply chain. NVIDIA has built a $99 billion equity portfolio Neutral Sentiment: Competitive and valuation considerations: NVIDIA remains dominant, but AMD, Broadcom and Intel are pursuing AI and server opportunities. Rising memory and optical-networking costs could pressure gross margins even if they confirm that demand exceeds supply. Negative Sentiment: Insider selling adds a cautionary signal: Director Mark Stevens sold roughly 648,500 shares in two transactions, while EVP Timothy Teter sold 30,000 shares. The sales were disclosed under planned transactions and represent small portions of their remaining holdings, limiting their significance but potentially weighing on sentiment. About NVIDIA (Free Report)

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.

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C2P Capital Advisory Group LLC d.b.a. Prosperity Capital Advisors grew its holdings in shares of NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 8.4% during the second quarter, according to its most recent 13F filing with the SEC. The institutional investor owned 63,849 shares of the computer hardware maker’s stock after buying an additional 4,944 shares during the period. NVIDIA makes up 0.6% of C2P Capital Advisory Group LLC d.b.a. Prosperity Capital Advisors’ investment portfolio, making the stock its 21st largest holding. C2P Capital Advisory Group LLC d.b.a. Prosperity Capital Advisors’ holdings in NVIDIA were worth $12,775,000 as of its most recent SEC filing.

Other large investors also recently modified their holdings of the company. Defender Capital LLC. raised its holdings in shares of NVIDIA by 0.7% during the second quarter. Defender Capital LLC. now owns 7,534 shares of the computer hardware maker’s stock valued at $1,507,000 after purchasing an additional 50 shares during the period. Spectrum Financial Alliance Ltd LLC grew its stake in shares of NVIDIA by 3.8% in the 1st quarter. Spectrum Financial Alliance Ltd LLC now owns 1,395 shares of the computer hardware maker’s stock valued at $243,000 after buying an additional 51 shares during the period. PFS Partners LLC grew its stake in shares of NVIDIA by 1.2% in the 2nd quarter. PFS Partners LLC now owns 4,375 shares of the computer hardware maker’s stock valued at $875,000 after buying an additional 51 shares during the period. LMG Wealth Partners LLC increased its position in NVIDIA by 0.7% in the 4th quarter. LMG Wealth Partners LLC now owns 7,649 shares of the computer hardware maker’s stock valued at $1,427,000 after buying an additional 53 shares in the last quarter. Finally, Vision Financial Markets LLC increased its position in NVIDIA by 1.2% in the 3rd quarter. Vision Financial Markets LLC now owns 4,640 shares of the computer hardware maker’s stock valued at $866,000 after buying an additional 53 shares in the last quarter. Institutional investors and hedge funds own 65.27% of the company’s stock.

Key Headlines Impacting NVIDIA Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: Hugging Face expands NVIDIA’s AI ecosystem: The acquisition gives NVIDIA access to Hugging Face’s open-source platform, which hosts millions of models, applications and datasets used by more than 18 million developers. Investors view the deal as a way to deepen CUDA adoption, strengthen NVIDIA’s software moat and position the company as an AI platform provider rather than solely a chip supplier. Management says Hugging Face will remain open to the broader AI ecosystem. Why NVIDIA’s defensive move to acquire Hugging Face is about much more than chips Positive Sentiment: New consumer AI revenue channel: Lenovo and Acer are expected to launch Windows PCs powered by NVIDIA’s RTX Spark chip in October. Local AI processing could expand NVIDIA’s addressable market while reducing reliance on cloud data centers. HP also announced new OmniBook PCs using RTX Spark technology. NVIDIA sets October launch for RTX Spark AI PCs Positive Sentiment: Analyst support and demand remain strong: Needham and Rosenblatt reaffirmed Buy ratings with price targets of $300 and $390, respectively. Recent earnings showed revenue growth above 100%, a 63.7% net margin and results ahead of consensus, while management’s long-term outlook continues to imply robust AI infrastructure spending. NVIDIA’s equity investments in companies such as OpenAI, CoreWeave and Nebius have also grown substantially, reinforcing its influence across the AI supply chain. NVIDIA has built a $99 billion equity portfolio Neutral Sentiment: Competitive and valuation considerations: NVIDIA remains dominant, but AMD, Broadcom and Intel are pursuing AI and server opportunities. Rising memory and optical-networking costs could pressure gross margins even if they confirm that demand exceeds supply. Negative Sentiment: Insider selling adds a cautionary signal: Director Mark Stevens sold roughly 648,500 shares in two transactions, while EVP Timothy Teter sold 30,000 shares. The sales were disclosed under planned transactions and represent small portions of their remaining holdings, limiting their significance but potentially weighing on sentiment. NVIDIA Price Performance Shares of NASDAQ:NVDA opened at $230.36 on Monday. The stock has a market cap of $5.55 trillion, a price-to-earnings ratio of 29.12, a PEG ratio of 1.81 and a beta of 2.22. The company has a quick ratio of 3.85, a current ratio of 4.59 and a debt-to-equity ratio of 0.14. NVIDIA Corporation has a 12-month low of $164.07 and a 12-month high of $236.54. The business’s 50 day moving average is $210.61 and its 200 day moving average is $202.19. NVIDIA (NASDAQ:NVDA – Get Free Report) last announced its quarterly earnings results on Wednesday, August 26th. The computer hardware maker reported $2.22 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.09 by $0.13. The business had revenue of $96.22 billion during the quarter, compared to the consensus estimate of $92.27 billion. NVIDIA had a return on equity of 96.04% and a net margin of 63.66%.NVIDIA’s revenue was up 105.9% compared to the same quarter last year. During the same quarter in the prior year, the company posted $1.05 earnings per share. On average, sell-side analysts forecast that NVIDIA Corporation will post 9.1 earnings per share for the current fiscal year.

NVIDIA declared that its board has authorized a stock buyback program on Wednesday, May 20th that allows the company to repurchase $80.00 billion in outstanding shares. This repurchase authorization allows the computer hardware maker to buy up to 1.5% of its shares through open market purchases. Shares repurchase programs are typically an indication that the company’s management believes its shares are undervalued.

NVIDIA Dividend Announcement The company also recently announced a quarterly dividend, which will be paid on Thursday, October 1st. Stockholders of record on Thursday, September 10th will be paid a $0.25 dividend. The ex-dividend date is Thursday, September 10th. This represents a $1.00 annualized dividend and a dividend yield of 0.4%. NVIDIA’s dividend payout ratio is presently 12.64%.

Insider Activity In other NVIDIA news, Director Mark A. Stevens sold 63,501 shares of NVIDIA stock in a transaction that occurred on Tuesday, September 1st. The shares were sold at an average price of $220.06, for a total transaction of $13,974,030.06. Following the transaction, the director owned 4,558,770 shares of the company’s stock, valued at $1,003,202,926.20. This trade represents a 1.37% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. Also, EVP Timothy S. Teter sold 30,000 shares of NVIDIA stock in a transaction that occurred on Monday, August 31st. The stock was sold at an average price of $217.88, for a total transaction of $6,536,400.00. Following the transaction, the executive vice president directly owned 2,687,660 shares in the company, valued at approximately $585,587,360.80. This represents a 1.10% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 1,563,501 shares of company stock valued at $335,380,530. 3.94% of the stock is currently owned by corporate insiders.

Wall Street Analysts Forecast Growth Several research analysts have issued reports on NVDA shares. Seaport Research Partners increased their price target on NVIDIA from $140.00 to $180.00 and gave the stock a “sell” rating in a report on Thursday, May 21st. Cantor Fitzgerald reaffirmed an “overweight” rating and set a $350.00 target price on shares of NVIDIA in a research report on Monday, August 24th. Jefferies Financial Group reiterated a “buy” rating on shares of NVIDIA in a report on Wednesday, August 26th. Stifel Nicolaus set a $315.00 price target on shares of NVIDIA in a research report on Thursday, August 27th. Finally, UBS Group set a $300.00 price target on shares of NVIDIA and gave the company a “buy” rating in a research note on Thursday, August 27th. Two research analysts have rated the stock with a Strong Buy rating, fifty have given a Buy rating and three have assigned a Hold rating to the stock. According to data from MarketBeat, NVIDIA has a consensus rating of “Moderate Buy” and a consensus price target of $324.83.

Get Our Latest Stock Analysis on NVDA

About NVIDIA (Free Report)

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.

Featured Articles Five stocks we like better than NVIDIA AI Token Costs Are Changing the Hardware vs. Software Debate 3 ETFs That Could Move as Rate Expectations Shift 3 Stocks With September Catalysts Investors Shouldn’t Ignore Ollie’s Bargain Outlet Stock Falls on Weak Comps Despite Margin Gains

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Huawei's best AI chip cannot keep pace with Nvidia hardware that is already three generations old, and the gap is widening faster than most investors realize.

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For retirement investors seeking the cleanest way to own the AI infrastructure buildout, NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) at $230.36 warrants a hard look, because the company is selling a product no rival can match at a price the market has not caught up to. China’s best domestic AI chip, Huawei’s Ascend 910C, tops out at roughly 780 teraflops (TFLOPS) of FP16 performance, less than half of the ~1,700 TFLOPS delivered by NVIDIA’s H200, a chip unveiled nearly three years ago. While competitors chase that old benchmark, NVIDIA has moved through Blackwell, Blackwell Ultra, and into full production on Vera Rubin, whose single GPU delivers 4,000 TFLOPS of FP16 compute. That is the definition of a widening moat.

Growth That Justifies the Multiple Q2 FY27 revenue reached $96.22 billion, up 105.85% year over year, with Data Center revenue of $89.02 billion (+117%). Management guided Q3 to $108.0 billion ±2% at a ~74% gross margin. At a trailing P/E of 46, NVDA trades cheaper than either of its listed rivals despite generating a 55.60% net margin and 101.5% return on equity. That is a rare combination at this scale, and the same data-center buildout driving these numbers is powered by a broader supplier ecosystem (we profiled seven of those non-chipmaker AI infrastructure names in a free report here: 7 Stocks Powering the AI Boom).

Head to Head: NVIDIA Outclasses AMD and Intel Advanced Micro Devices (NASDAQ:AMD) is the closest US-listed AI accelerator peer, and the head-to-head favors NVIDIA on every meaningful line. AMD trades at a P/E of 180, roughly four times NVDA’s multiple, with a Q2 2026 non-GAAP gross margin of 56% versus NVIDIA’s 75%, and Data Center revenue of only $6.72 billion. NVIDIA’s Data Center segment alone is more than thirteen times larger. Intel (NASDAQ:INTC) sits well behind: it posted a Q2 FY26 GAAP net loss of -$11.033 billion and carries a negative earnings yield. Intel’s own DGX Rubin servers use NVIDIA silicon at the center of the rack.

Capital Returns Sweeten the Case NVIDIA returned approximately $26 billion to shareholders in Q2 alone and still has ~$99.0 billion left on its buyback authorization. Free cash flow hit $21.34 billion for the quarter, up 58.43%. The dividend is small at $0.25 per share, but per-share compounding through buybacks is doing the real work for long-duration holders.

China Risk, Dismissed The obvious pushback is China export controls. That worry is already priced out. Hopper shipments to China were less than 1% of total Data Center revenue in Q2, and the $108 billion Q3 guide explicitly assumes zero Data Center compute revenue from China. NVIDIA is printing record numbers without the market Washington fenced off. As Jensen Huang put it on the last call, “AI has reached its inflection point. It’s doing useful work. Its tokens are productive and profitable. Now, compute is revenue.”

For long-duration holders, Vera Rubin’s compounding is the story to watch from here.

Contact [email protected] for any questions or corrections.

Nvidia (NVDA +0.84%) recently announced results that crushed Wall Street estimates. Its sales surged 106% year over year to $96.2 billion. Diluted earnings per share were up by an even better 128%.

It looks like the leading artificial intelligence (AI) business can do no wrong. Momentum continues to be on its side. Nvidia has possibly been the biggest winner in the ongoing AI infrastructure build-out.

And it shows, as shares have jumped 920% in five years (as of Sept. 3). This company has established itself as the world's most valuable enterprise.

But what's surprising to learn is that the AI stock isn't expensive. It trades at a forward price-to-earnings (P/E) ratio of 24.2. Based strictly on the jaw-dropping financial results this business keeps reporting, it's easy to argue that shares should command double the current valuation multiple.

Is the market warning investors about what's to come?

Image source: The Motley Fool.

AI to the moon By any metric, AI usage is showing no sign of slowing. The number of tokens processed by Alphabet model APIs, for example, totaled 22 billion per minute last quarter. This was up from 16 billion three months before.

OpenAI and Anthropic, the two prominent AI labs that are planning for trillion-dollar initial public offerings in the near future, are posting skyrocketing revenue figures. And they have rapidly expanding user bases.

Amazon Web Services, Microsoft Azure, and Google Cloud are major hyperscalers that continue to reveal gargantuan customer order amounts with each passing quarter. As of June 30, they had a combined $1.7 trillion in cloud backlogs.

Consequently, the spending isn't letting up. Colette Kress, Nvidia's chief financial officer, estimates that hyperscaler capital expenditures (capex) will come in at $1.3 trillion in 2027. And before the end of the decade, management believes annual AI infrastructure spending will be between $3 trillion and $4 trillion.

All of this demand directly flows to the impressive financial metrics coming from Nvidia. It sells the powerful data center graphics processing units (GPUs) that support AI model training and inference.

On the recent Q2 2027 earnings call, Kress noted that the company expects 70% revenue growth in fiscal 2028. Assuming consensus estimates hold up and Nvidia's margin profile doesn't change, this outlook implies that the business will report a whopping $461 billion in operating income next fiscal year. This would be well ahead of anyone else.

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Durability of demand is the trillion-dollar question All of this information should make every investor extremely bullish about Nvidia's prospects. However, the market is concerned about the durability of Nvidia's growth. The forward P/E ratio of 24.2 demonstrates this.

No matter how smart the experts might sound, no one has any idea how long the AI boom will last. While the robust demand trends and ballooning capex numbers are optimistic data points, things could change quickly.

Maybe the enterprises that are driving usage don't realize the tangible benefits they were hoping for, prompting these customers to cut their AI-related budgets. There's a material probability that meaningful returns come later than the bulls hope, creating a timing gap (and potential bubble bursting) that calls into question how long the sizable capex can continue.

That would have a ripple effect up the value chain. If there's any evidence that AI spending is going to slow, sell-side analysts will be forced to lower their profit estimates for Nvidia. And the share price could drop.

Watching Nvidia's meteoric rise has been very exciting. AI can truly be a game-changing technology.

However, this is uncharted territory. And Nvidia's success rides on the music not stopping, not to mention its ability to fend off rivals developing more advanced chips.

Just like the industry is starved for Nvidia GPUs, the market has an unquenchable thirst for certainty. This is exactly why the company's quarterly results are so closely watched to ensure the growth story is alive. Trillions of dollars are on the line.

Fort Washington Investment Advisors Inc. OH raised its position in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 0.9% in the 2nd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 2,764,618 shares of the computer hardware maker’s stock after purchasing an additional 24,571 shares during the quarter. NVIDIA accounts for about 2.8% of Fort Washington Investment Advisors Inc. OH’s holdings, making the stock its 5th biggest holding. Fort Washington Investment Advisors Inc. OH’s holdings in NVIDIA were worth $553,172,000 at the end of the most recent reporting period.

Several other institutional investors also recently modified their holdings of NVDA. State Street Corp grew its holdings in NVIDIA by 1.2% in the fourth quarter. State Street Corp now owns 991,480,489 shares of the computer hardware maker’s stock worth $184,911,111,000 after purchasing an additional 11,451,386 shares during the period. Geode Capital Management LLC raised its position in NVIDIA by 0.6% in the 4th quarter. Geode Capital Management LLC now owns 588,803,093 shares of the computer hardware maker’s stock valued at $109,446,217,000 after buying an additional 3,383,441 shares during the last quarter. Norges Bank bought a new stake in NVIDIA in the 4th quarter worth about $62,244,133,000. Bank of America Corp DE raised its stake in shares of NVIDIA by 2.1% during the 1st quarter. Bank of America Corp DE now owns 191,200,989 shares of the computer hardware maker’s stock worth $33,345,453,000 after purchasing an additional 4,019,505 shares during the period. Finally, Legal & General Group Plc grew its position in shares of NVIDIA by 1.5% during the 3rd quarter. Legal & General Group Plc now owns 181,203,035 shares of the computer hardware maker’s stock valued at $33,808,862,000 after acquiring an additional 2,609,560 shares during the period. Institutional investors own 65.27% of the company’s stock.

Analyst Upgrades and Downgrades A number of equities analysts have recently commented on NVDA shares. New Street Research cut their price target on NVIDIA from $343.00 to $340.00 in a report on Thursday, May 21st. China Renaissance increased their price target on shares of NVIDIA from $319.00 to $330.00 and gave the company a “buy” rating in a research report on Monday, August 31st. Wells Fargo & Company reaffirmed an “overweight” rating and issued a $315.00 price target on shares of NVIDIA in a research note on Tuesday, August 11th. UBS Group set a $300.00 price objective on shares of NVIDIA and gave the stock a “buy” rating in a report on Thursday, August 27th. Finally, Wedbush increased their price objective on NVIDIA from $330.00 to $345.00 and gave the stock an “outperform” rating in a report on Thursday, August 27th. Two analysts have rated the stock with a Strong Buy rating, fifty have issued a Buy rating and three have assigned a Hold rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average price target of $324.83.

Read Our Latest Stock Analysis on NVDA NVIDIA News Summary Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: Hugging Face expands NVIDIA’s AI ecosystem: The acquisition gives NVIDIA access to Hugging Face’s open-source platform, which hosts millions of models, applications and datasets used by more than 18 million developers. Investors view the deal as a way to deepen CUDA adoption, strengthen NVIDIA’s software moat and position the company as an AI platform provider rather than solely a chip supplier. Management says Hugging Face will remain open to the broader AI ecosystem. Why NVIDIA’s defensive move to acquire Hugging Face is about much more than chips Positive Sentiment: New consumer AI revenue channel: Lenovo and Acer are expected to launch Windows PCs powered by NVIDIA’s RTX Spark chip in October. Local AI processing could expand NVIDIA’s addressable market while reducing reliance on cloud data centers. HP also announced new OmniBook PCs using RTX Spark technology. NVIDIA sets October launch for RTX Spark AI PCs Positive Sentiment: Analyst support and demand remain strong: Needham and Rosenblatt reaffirmed Buy ratings with price targets of $300 and $390, respectively. Recent earnings showed revenue growth above 100%, a 63.7% net margin and results ahead of consensus, while management’s long-term outlook continues to imply robust AI infrastructure spending. NVIDIA’s equity investments in companies such as OpenAI, CoreWeave and Nebius have also grown substantially, reinforcing its influence across the AI supply chain. NVIDIA has built a $99 billion equity portfolio Neutral Sentiment: Competitive and valuation considerations: NVIDIA remains dominant, but AMD, Broadcom and Intel are pursuing AI and server opportunities. Rising memory and optical-networking costs could pressure gross margins even if they confirm that demand exceeds supply. Negative Sentiment: Insider selling adds a cautionary signal: Director Mark Stevens sold roughly 648,500 shares in two transactions, while EVP Timothy Teter sold 30,000 shares. The sales were disclosed under planned transactions and represent small portions of their remaining holdings, limiting their significance but potentially weighing on sentiment. Insider Transactions at NVIDIA In related news, Director Mark A. Stevens sold 885,000 shares of the stock in a transaction on Thursday, June 18th. The stock was sold at an average price of $210.17, for a total value of $186,000,450.00. Following the completion of the transaction, the director directly owned 5,207,271 shares of the company’s stock, valued at approximately $1,094,412,146.07. This represents a 14.53% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Timothy S. Teter sold 30,000 shares of the firm’s stock in a transaction on Monday, August 31st. The stock was sold at an average price of $217.88, for a total value of $6,536,400.00. Following the completion of the sale, the executive vice president directly owned 2,687,660 shares of the company’s stock, valued at $585,587,360.80. This trade represents a 1.10% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 1,563,501 shares of company stock worth $335,380,530 over the last three months. Corporate insiders own 3.94% of the company’s stock.

NVIDIA Stock Up 0.8% Shares of NVDA opened at $230.36 on Friday. The business’s 50 day simple moving average is $210.61 and its 200-day simple moving average is $202.05. NVIDIA Corporation has a 1 year low of $164.07 and a 1 year high of $236.54. The company has a debt-to-equity ratio of 0.14, a current ratio of 4.59 and a quick ratio of 3.85. The stock has a market capitalization of $5.55 trillion, a price-to-earnings ratio of 29.12, a price-to-earnings-growth ratio of 1.79 and a beta of 2.22.

NVIDIA (NASDAQ:NVDA – Get Free Report) last released its earnings results on Wednesday, August 26th. The computer hardware maker reported $2.22 earnings per share for the quarter, beating the consensus estimate of $2.09 by $0.13. NVIDIA had a return on equity of 96.04% and a net margin of 63.66%.The firm had revenue of $96.22 billion for the quarter, compared to the consensus estimate of $92.27 billion. During the same quarter in the previous year, the company posted $1.05 EPS. The company’s revenue for the quarter was up 105.9% compared to the same quarter last year. As a group, equities analysts expect that NVIDIA Corporation will post 9.1 earnings per share for the current fiscal year.

NVIDIA Announces Dividend The business also recently declared a quarterly dividend, which will be paid on Thursday, October 1st. Shareholders of record on Thursday, September 10th will be issued a $0.25 dividend. The ex-dividend date of this dividend is Thursday, September 10th. This represents a $1.00 dividend on an annualized basis and a dividend yield of 0.4%. NVIDIA’s dividend payout ratio (DPR) is currently 12.64%.

NVIDIA announced that its Board of Directors has initiated a stock repurchase plan on Wednesday, May 20th that authorizes the company to repurchase $80.00 billion in outstanding shares. This repurchase authorization authorizes the computer hardware maker to repurchase up to 1.5% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company’s management believes its shares are undervalued.

About NVIDIA (Free Report)

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.

See Also Five stocks we like better than NVIDIA Revolution Medicines Got Its Breakthrough—What Moves It Next? Retail Earnings Just Exposed a Bigger Divide in the U.S. Consumer Economy FB Financial’s Southern Expansion and Buybacks Drive Analyst Optimism AST SpaceMobile Stock Soared 12%—This Was the Catalyst Want to see what other hedge funds are holding NVDA? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for NVIDIA Corporation (NASDAQ:NVDA – Free Report).

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Historically, September has been a difficult month for Wall Street. The S&P 500 has fallen by an average of about 1.1% during the month from 1926 through 2024. Yet Nvidia (NVDA +0.84%) stock has gained ground in seven of the past 10 Septembers, with a median return of about 1.5%. Hence, while the September Effect may offer a reason for some caution around the overall stock market, it hasn't been such a negative indicator for Nvidia's stock.

And recently, CEO Jensen Huang also gave investors a potentially more important signal. He said Nvidia expects revenue to grow about 70% in its fiscal 2028, which begins Jan 31, 2027. But management says even that forecast doesn't reflect the full scope of demand for its offerings; it's constrained by the limited supply of components required to build its artificial intelligence (AI) platforms. 

Nvidia CEO Jensen Huang. Image source: Nvidia.

Nvidia's visibility into future demand is sharpening In its fiscal 2027 second quarter (which ended July 26), Nvidia's revenue soared by 106% year over year to $96.2 billion, including $89 billion in sales from the data center segment. However, management's long-term outlook was even more impressive.

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Wall Street analysts had previous expected the company to deliver fiscal 2028 revenue of about $570 billion, translating to growth of roughly 44%. Nvidia's guidance, however, implies revenue of close to $700 billion.

CEO Jensen Huang said that Nvidia has never offered revenue guidance for a full year in advance before. However, this time, the company has much better visibility into memory and manufacturing capacity, as well as the land, power, and data-center infrastructure needed to deploy its products. Some of this infrastructure needs to be secured two to three years in advance.

Supply constraints could limit Nvidia's fiscal 2028 growth CFO Colette Kress highlighted that customer forecasts currently indicate Nvidia's revenue may double next year. Huang also said Nvidia's revenue growth could be "a lot higher" if the company were not supply-constrained.

Nvidia exited the fiscal second quarter with $279 billion of supply and capacity commitments, up sequentially from $119 billion. These commitments are primarily related to memory purchases and manufacturing capacity. Of that total, $92 billion is scheduled for the rest of fiscal 2027, $87 billion for fiscal 2028, and $88 billion for fiscal 2029.

Nvidia's largest customers are also continuing to spend heavily on AI infrastructure. Amazon (AMZN -0.15%) Web Services plans to deploy another 2 million Nvidia GPUs in calendar years 2027 and 2028. Nvidia also expects the combined capital expenditures of the top five hyperscalers to approach $800 billion in 2026 and $1.3 trillion in 2027.

The demand trends look impressive, even when the company is not factoring any data center compute revenue from China into its current outlook. Hence, a meaningful recovery of its position in the Chinese market is not currently part of Nvidia's growth expectations.

Nvidia's revenue opportunity per AI data center is expanding Nvidia is also expanding its revenue opportunity from each gigawatt (power capacity) of AI infrastructure. Management estimates that this opportunity has increased from roughly $18 billion with Hopper GPUs to $25 billion with Blackwell systems and $40 billion with Vera Rubin systems. These increases are partly a result of the fact that Nvidia is selling more components of the overall AI system, including CPUs, GPUs, NVLink (Nvidia's high-speed technology for connecting GPUs and other processors), and other networking products. Hence, the company benefits not only from the construction of more AI data centers, but also because it is generating more revenue per gigawatt of new capacity deployed.

Increasing adoption of agentic AI could further drive demand for compute capacity. Huang said AI agents can require roughly 15 to 100 times more compute than direct human use of AI, depending on the task. These agents can also run continuously and interact with other agents. Hence, future demand for Nvidia's wares may increasingly depend on the actual use of AI applications rather than on the computing power required to train AI models.

Nvidia's growth outlook also comes with risks Nvidia, however, has warned that customer demand forecasts can prove inaccurate. Its customers may also delay purchases because of constraints related to data center infrastructure or capital availability. In such a scenario, Nvidia's large commitments to its own suppliers could result in higher costs.

Nvidia is also providing support for some large AI infrastructure projects. In August, the company agreed to provide guarantees of up to $105 billion for a data center project in Ohio. That campus will exclusively host Nvidia computing systems under 20-year leases to OpenAI. Huang also said AI labs for which Nvidia expects to use its balance sheet could account for roughly one-quarter of the company's business in fiscal 2028.

Rising memory costs could also pressure profitability. Nvidia expects its gross margins to fall from 75% in the fiscal second quarter to around 71% to 72% in the fiscal fourth quarter, before improving to around 72% to 73% in fiscal 2028. Management attributed much of this pressure to sharp increases in memory prices.

Nvidia's stock also faces near-term pressure. On Sept. 1, rising Treasury yields and oil prices pushed the Nasdaq Composite down by 1%. Besides these marketwide risks, Nvidia is also facing concerns about some of its AI financing arrangements. Its stock slipped by 1.5% during the session.

September could still bring volatility for Nvidia investors. However, it is obvious that Nvidia now has much greater visibility into demand several years ahead. If that visibility holds, short-term weaknesses could matter far less than the scale of the growth opportunity the company is preparing for.

Nearly three decades ago, Nvidia (NVDA +0.79%) started off as a chip designer for enhancing graphics for video games. As it turned out, these chips were also unusually good at the kind of math that trains artificial intelligence (AI).

Over the years, Nvidia built accompanying software and systems that allow researchers and cloud hyperscalers to actually use these chips for more-advanced applications. The combination of fast-processing chips plus the tools to run them made the company the default supplier when large language models (LLM) took off a few years ago.

Its Hopper chips were the workhorses of the first AI wave. Management smartly reinvested the profits it made from Hopper into research and development. Subsequently, the company's Blackwell architecture hit the market and became another monster success.

The theme is that each generation of new chips made it cheaper and faster to train models and get inference deployments into production. Now, Vera Rubin is the next step in Nvidia's chip roster. Let's explore what makes it unique and why this product could be a game changer for the business.

Image source: Nvidia.

What does demand for Vera Rubin look like? During the second-quarter earnings call, management guided for $108 billion in sales for next quarter. Chief Financial Officer Colette Kress said, "We see Vera Rubin accounting for about 20% of data center revenue in Q3." Considering that Nvidia's data center segment makes up more than 90% of the company's total revenue, it's reasonable to forecast Vera Rubin being on track for something close to $20 billion of sales in its first real quarter of shipments.

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This is an unusually fast start. Management, which already has orders from every major hyperscaler, called Vera Rubin the fastest product ramp-up in its history. This matters because cloud infrastructure providers such as Amazon Web Services, Microsoft Azure, and Alphabet's Google Cloud -- as well as AI labs like OpenAI and Anthropic -- continue to pour unprecedented sums into data centers. The largest AI developers are expected to spend close to $800 billion on capital expenditures this year and $1.3 trillion next year.

To quantify what this translates to for the company, consider the following: Nvidia used to collect about $18 billion in revenue for every gigawatt of computing capacity it helped install with Hopper. With Blackwell, that figure rose to $25 billion. Kress says that with Vera Rubin, the company can reach $40 billion per gigawatt. The increase comes from selling more of the underlying AI rack -- accelerators, networking, and now its own processors -- rather than just the graphics chips.

How Vera Rubin changes the economics of AI factories Nvidia is marketing the Vera Rubin system as one that delivers more useful work for each watt of electricity consumed. In turn, developers can meaningfully reduce the cost of generating each AI token compared with the prior generations of hardware. For more-sophisticated uses in agentic AI, these efficiencies are important.

What makes Vera Rubin unique is that it also includes a processor to sit beside the chip itself. This expands Nvidia's addressable market, because customers are no longer only buying chip clusters but rather designing a complete factory for producing intelligence alongside Nvidia.

As AI infrastructure keeps accelerating, the supplier that owns more of that factory should be positioned to capture a larger slice of every new data center. This is exactly why the order book for Vera Rubin is already so full and why Nvidia is already talking about 70% revenue growth for next year.

Is Nvidia stock still a buy? The stock trades at a forward price-to-earnings ratio (P/E) of about 24. Nvidia itself described its fiscal 2028 sales outlook as limited by how many chips it can produce, not by how many customers want them. This is important to understand, because if supply improves even nominally, or if the new Vera Rubin systems sell more of the adjacent gear than anticipated, earnings could come in much higher than Wall Street is currently modeling.

NVDA PE Ratio (Forward) data by YCharts.

There are some risks when it comes to investing in Nvidia. The cost of memory is getting exponentially more expensive, which will pressure gross margins for a few quarters. Meanwhile, China remains an uncertain market.

Nevertheless, the combination of an estimated $20 billion contribution from a brand-new product in its first quarter, a rising take per data center watt, and management's admission that underlying demand is stronger than the 70% growth target suggests investors may be underestimating the company's future cash flow.

For long-term investors, this is the simple case: The AI infrastructure cycle looks far from finished, but Nvidia stock is priced as if it might be. For this reason, I see it as a no-brainer stock to buy and hold at its current price point.

The biggest new customer for Nvidia Corp‘s (NASDAQ:NVDA) next-generation AI chips isn’t another chatbot maker or cloud giant. It’s a humanoid robotics company.

Figure AI’s decision to secure access to up to 100,000 Nvidia Vera Rubin GPUs signals that the next wave of AI infrastructure spending may come from teaching robots how to understand and interact with the physical world—not just generate text.

Beyond ChatbotsFigure this week announced a strategic partnership with AI cloud provider Nscale to deploy up to 100,000 GPUs built on Nvidia’s Vera Rubin platform. The agreement includes an initial $3.5 billion compute commitment, with plans to scale beyond $6 billion, as Figure trains the AI models powering its humanoid robots. Deployments are expected to begin in the second half of 2027.

While the headline numbers are eye-catching, the more important takeaway is why Figure needs that much computing power.

The company said it is increasingly constrained not by hardware manufacturing but by the data and compute required to train Helix, its robotics foundation model. Figure also pointed to Index, its recently launched data platform, which it says is generating 35 minutes of training data every second.

“Data alone cannot solve this problem,” the company said. “Scaling physical intelligence will require an immense amount of compute.”

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The Rise of Physical AIFor Nvidia, the announcement underscores how demand for AI infrastructure is broadening beyond large language models.

Humanoid robots represent a fundamentally different AI challenge. Instead of answering questions or writing code, they must perceive the physical world, understand their surroundings and safely perform real-world tasks. That requires continuous training on massive amounts of visual and behavioral data.

Nvidia CEO Jensen Huang described the partnership as activating a “robotics flywheel.” In his words, Figure’s AI models will train on Nvidia’s Vera Rubin platform through Nscale’s cloud, validate in Nvidia Isaac Sim, and ultimately deploy on Nvidia-powered robots. He called it “the physical AI flywheel” that will accelerate the path from AI models to real-world robots.

That framing matters because it positions robotics as a new long-term demand driver for Nvidia’s AI ecosystem rather than simply another buyer of GPUs.

What Investors Should WatchInvestors have largely viewed Nvidia’s growth through the lens of hyperscalers and generative AI companies racing to build ever-larger language models. Figure’s latest commitment suggests another market is beginning to emerge.

If humanoid robotics scales as companies such as Figure envision, demand for AI infrastructure may increasingly come from training machines to operate in the physical world.

For Nvidia, that could broaden its customer base beyond cloud providers and AI labs, reinforcing Huang’s long-held view that physical AI represents the industry’s next frontier. The Figure partnership may be one of the clearest signs yet that the shift is already underway.

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Nvidia CEO Jensen Huang. Tomohiro Ohsumi/Getty Images Nvidia has built a nearly $100 billion equity portfolio from virtually scratch in just two years by investing in other tech companies.

The AI chipmaker, led by CEO Jensen Huang, held $99 billion in equity investments as of July 26, according to its latest earnings report.

That included roughly $48 billion in publicly traded stocks and other marketable securities, $48 billion in shares of private companies and other non-marketable securities, and $3 billion in equity-method investments.

Its equity portfolio surged 14-fold in a year from about $7 billion last summer, and 45-fold from $2.2 billion two summers ago. The company also reported a further $25 billion in equity investment commitments as of July 26.

Nvidia's quarterly portfolio disclosure offered a glimpse at its public US stock portfolio as of June 30. It held a $30 billion stake in Intel, a $21 billion position in SpaceX, and investments in CoreWeave, Coherent, Synopsys, and Nokia, each worth between $2 billion and $5 billion.

Nvidia stock falls despite beating revenue estimates

The huge increase in Nvidia's equity holdings has vaulted it into the ranks of the biggest tech investors. It still trails the likes of Alphabet, which had a $232 billion equity portfolio at the end of June, including $94 billion of SpaceX shares following its IPO in June.

Nvidia stock has rocketed from below $15 at the start of 2023 to $228 at Thursday's close. That 15-fold increase in under three years has catapulted its market capitalization to $5.5 trillion, making it the world's most valuable company.

The chipmaker has become the premier enabler of the AI boom by providing the types of semiconductors needed to power the nascent technology, financing the AI infrastructure buildout, and investing in its AI peers.

A Nvidia spokesperson pointed Business Insider to finance chief Colette Kress, saying on the company's latest earnings call that frontier AI labs' ability to improve their products, attract more users, and generate more revenue was being "limited by compute," so Nvidia was "needed to help power this flywheel" and had thus invested almost $50 billion in them.

In its latest earnings report, Nvidia said that it makes equity investments to "enhance our growth opportunities, cultivate our ecosystem, and strengthen our competitive position."

However, Michael Burry of "The Big Short" fame has said Nvidia is "overreaching" in its efforts to juice its growth by financing and investing in customers of its chips.

Similarly, former "Shark Tank" investor Mark Cuban has said it's "truly scary" how reliant the AI boom is on Nvidia "funding everyone and anyone."

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Theron Mohamed You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.

Theron Mohamed is a London-based correspondent on the International team at Business Insider. His coverage spans finance, investing, wealth, markets, and the economy.Theron joined BI in 2019 as a reporter at Markets Insider and rose to the rank of correspondent before moving to the Trending team then the broader International team. He previously covered tech, media, and telecom stocks for Investors Chronicle magazine and had a brief stint on the Financial Times' Data team. He interned at the Wall Street Journal in New York where he primarily wrote for Heard on the Street.Theron has freelanced for The Independent, The Telegraph, WIRED, and several smaller publications. He holds an undergraduate degree in geography from the London School of Economics, and a master's degree in journalism from Columbia University.Theron often covers Warren Buffett, Michael Burry, and other elite investors. He also writes about the world's wealthiest people and shares financial advice from all manner of rich and successful people.Email Theron at [email protected] and follow him on X @theron_mohamed.

Tech Investing SpaceX More Intel AI Mark Cuban

Nvidia has become one of the world's largest strategic tech backers as the value of its equity investments soared more than tenfold in the past year to $99 billion, with the chip giant increasingly looking to leverage its huge capital reserves to bolster the AI sector.

The company has ramped up dealmaking for financing rounds across the AI stack in the previous 12 months, with over $40 billion committed in 2026. Equity investments were valued at $99 billion as of July 26, up from about $7 billion a year earlier and about $2.2 billion two years earlier.

The rise in value puts Nvidia among the strategic investors with the largest tech holdings around the world. The company still trails some more established tech firms, with Alphabet and Amazon both posting equity investments worth over $100 billion in recent earnings.

Capital has increasingly become a key play for Nvidia.

In August, the company announced partnerships with major investment firms aimed at mobilizing more than $500 billion worth of financing for Nvidia's graphics processing units (GPUs) and said it would provide up to $105 billion of conditional credit support for an OpenAI data center in Ohio. Nvidia also announced Thursday it is planning to acquire AI startup Hugging Face for $12.9 billion.

Frontier labs, neoclouds and companies building software and novel tech for AI — both in private and public markets — have been recipients of cash, with the value of Nvidia's equity holdings also buoyed by skyrocketing tech stocks.

Nvidia made the investments to enhance its growth opportunities, cultivate its ecosystem and strengthen its competitive position, the company said in its earnings.

"Nvidia has a clear interest in ensuring that its customers and partners prosper to provide future business for Nvidia," Ian Fogg, research director at CCS Insight, told CNBC. "Equity investments help companies to innovate, but also give Nvidia a degree of control to encourage companies to take a Nvidia-related innovation path."

Securing positioningNvidia dominates the market for the most advanced chips used for AI, known as graphics processing units (GPUs). Business has boomed as a result.

The chip giant has seen its stock increase by 33% over the past 12 months, and its revenue soared 106% to $96.2 billion in its fiscal second quarter.

Nvidia stock.

"Nvidia is keen to diversify its AI business," said Fogg. "In its most recent quarter, $48.7bn of $96.2bn revenue came from the Hyperscale segment which includes the largest cloud players."

The company is taking steps including financing and equity investments to "increase the range of customers and create an AI ecosystem," he added. "Some aim to support emergent cloud providers, others help Nvidia grow new markets, like telecom for example with the $1bn Nokia equity investment."

Frontier AI labs have been major recipients of Nvidia splashing the cash. The chip giant's Chief Financial Officer Colette Kress told analysts on an earnings call that the company had invested "nearly $50 billion in the frontier AI labs."

Most recently, in February, Nvidia said it would invest $30 billion into OpenAI as part of the company's $110 billion funding round.

While frontier AI labs had "extraordinary" demand for compute, they were growing faster than balance sheets and credit profiles could support and struggled to secure AI factory infrastructure independently, Kress added. "Nvidia is needed to help power this flywheel."

Neoclouds, which buy Nvidia GPUs and then rent access to companies, such as Nebius and CoreWeave, have also courted the chip giant. January saw Nvidia invest $2 billion into CoreWeave and in March it was announced that Nebius secured a $2 billion investment.

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"By injecting capital directly into AI infrastructure financiers, specialized cloud providers and foundation model labs, Nvidia provides these startups with the balance sheet strength to purchase tens of thousands of Nvidia GPUs," Naveen Chhabra, principal analyst at Forrester, told CNBC.

The company has also invested in nascent technological areas. Since March, Nvidia has committed at least $6.5 billion into companies developing photonics and optical technology — which uses light to transmit data and is considered to be a more efficient alternative to transferring data using electricity.

Lumentum, Coherent and Marvell each received $2 billion investments from the tech giant.

"Optics/networking specialists, like Coherent, receive investments to ensure their tooling, NVLink protocols and design engines remain strictly optimized for Nvidia's architecture," said Chhabra. "This creates high switching costs and protects the CUDA software moat against competing accelerators from AMD or internal custom chips from cloud providers."

Nvidia has also seen its $5 billion investment in Intel soar to a value of $30 billion, while its SpaceX holding was worth $21 billion as of June.

"As global AI chip demand runs into physical supply constraints particularly around high-bandwidth memory (HBM) and advanced packaging, Nvidia uses strategic equity positions like in domestic manufacturing options like Intel, to secure priority manufacturing access, reduce Asian foundry concentration risk and stabilize key component supplies," said Chhabra.

Key Takeaways NVIDIA expects fiscal Q4 2027 non-GAAP gross margin to fall to 71%-72% before recovering.Higher memory costs are pressuring margins as AI demand drives rapid Data Center revenue growth.NVIDIA plans fiscal 2028 price increases and is expanding memory supply through major suppliers. NVIDIA Corporation’s (NVDA - Free Report) gross margin faces a new test as memory prices rise sharply amid the artificial intelligence (AI) infrastructure boom. The company delivered a strong 75% non-GAAP gross margin in the second quarter of fiscal 2027, but management expects this metric to decline in coming quarters. Still, NVIDIA’s pricing power, strong Blackwell demand and long-term supplier relationships could help it protect profitability above the 70% level.

NVIDIA expects third-quarter fiscal 2027 non-GAAP gross margin of 74%, plus or minus 50 basis points, down from 75% in the second quarter. The company expects non-GAAP gross margin to come down to 71%-72% in the fourth quarter before recovering to 72%-73% in fiscal 2028. The pressure is largely tied to higher memory costs. During the second-quarter earnings call, management stated pricing conditions have become more difficult than previously expected.

The impact is significant because memory is an important component of NVIDIA’s AI systems. Yet the higher costs are also a result of the same AI demand driving NVIDIA’s growth. The company’s second-quarter revenues jumped 106% year over year to $96.2 billion, while Data Center revenues surged 117% to $89 billion. Strong demand for Blackwell Ultra helped lift non-GAAP gross margin 250 basis points from the year-ago quarter.

NVIDIA is taking steps to secure supply. Its supply and capacity commitments increased to $279 billion, primarily because of memory procurement. The company also has long-standing relationships with the three major memory suppliers — Micron Technology, SK Hynix and Samsung — and is working with them to expand capacity.

Pricing power could provide another cushion. NVIDIA expects to implement price increases beginning in fiscal 2028, helping margins recover toward 72%-73%. With AI demand remaining strong and Vera Rubin entering production, NVIDIA appears capable of keeping gross margins comfortably above 70%, although near-term pressure is likely.

NVDA’s Rivals AMD & INTC Face Margin Tests Amid AI Chip BoomNVIDIA’s main competitors, Advanced Micro Devices, Inc. (AMD - Free Report) and Intel Corporation (INTC - Free Report) , are also witnessing margin improvement amid the rising demand for AI chips.

Advanced Micro Devices offers a growing alternative in AI accelerators. Its second-quarter 2026 revenues rose 50% year over year to $11.54 billion, while Data Center revenues jumped 107% to $6.72 billion, helped by Instinct MI350 GPUs and EPYC processors. AMD’s non-GAAP gross margin expanded to 56.2% from 43.3%, reflecting a favorable mix shift toward higher-value Data Center products.

Despite the significant improvement, Advanced Micro Devices’ non-GAAP gross margin remained well below NVIDIA’s. This suggests AMD has a lower cushion to absorb rising memory costs.

Intel is another competitor benefiting from growing AI infrastructure demand through its Xeon CPUs and manufacturing business. The company’s second-quarter 2026 revenues increased 25% year over year to $16.13 billion, while non-GAAP gross margin expanded to 41.8% from 29.7%.

Though Intel expects continued strong demand for server CPUs, it has warned that higher memory, wafer and substrate prices could pressure margins. The company has been investing heavily in manufacturing, including a planned $5.7 billion expansion of its Ireland facility.

For NVIDIA, the key advantage remains its much higher gross margin. AMD and Intel face their own cost pressures, but NVIDIA's strong AI demand and pricing power could give it greater flexibility to absorb higher memory costs while keeping margins above 70%.

NVIDIA’s Price Performance, Valuation and EstimatesShares of NVIDIA have risen around 20.2% year to date, outperforming the Zacks Computer and Technology sector’s gain of 15.5%.

NVIDIA YTD Price Return Performance
Image Source: Zacks Investment Research

From a valuation standpoint, NVDA trades at a forward price-to-earnings ratio of 17.98, below the sector’s average of 20.22.

NVIDIA Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for NVIDIA’s fiscal 2027 and 2028 earnings implies a year-over-year increase of approximately 93.3% and 64%, respectively. Estimates for fiscal 2027 and 2028 have been revised upward over the past seven days.

Image Source: Zacks Investment Research

NVIDIA currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

One stubborn number buried in Nvidia's latest earnings report signals something that almost never survives at hardware scale, and it is the reason this investor keeps adding shares despite a valuation that looks stretched on the surface.

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

I keep hitting the buy button on NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) because one number refuses to break, and that number tells me everything I need to know about pricing power in this cycle.

That number is gross margin. At the scale NVIDIA now operates, holding a 75% non-GAAP gross margin should be arithmetically difficult for a hardware company. The Q2 FY27 report landed exactly there: revenue of $96.22B, gross profit of $72.14B, non-GAAP gross margin at 75.0%. Management said the level was “largely unchanged from last quarter due to a similar product mix.” When a company sells $89 billion of data center gear in ninety days and still keeps three quarters of every dollar as gross profit, that is monopoly economics at hardware scale.

Pricing Power That Refuses to Compress Q2 FY27 revenue grew 105.85% YoY. Data center revenue reached $89.02B, up 117% YoY. Every one of those dollars was harder to earn than the one before it, because supply chain constraints hit foundry, memory, power, and yield simultaneously. Margins still held at 75%. Management guided Q3 gross margin to 74%, plus or minus 50 basis points, and fiscal 2028 to 72% to 73% once executed price increases work through memory costs. Even that compressed figure keeps NVIDIA well above any data center silicon peer. Vera Rubin, now in full production, expands the revenue opportunity to $40 billion per gigawatt, up from Blackwell’s $25 billion and Hopper’s $18 billion. Customers pay more because the platform delivers more.

Returns That Compound Faster Than the Multiple Return on invested capital is 92.2%. Return on equity is 101.5%. Debt-to-equity sits at 0.073, with interest coverage of 503.4x. Free cash flow in fiscal 2026 was $96.58B, up 58.7%. In Q2 alone NVIDIA returned $26 billion to shareholders, $20 billion in buybacks and $6 billion in dividends, with roughly $99B still authorized. Trailing P/E of 45 looks full, yet consensus already models fiscal 2028 EPS of $13.1277 against $4.77 in FY26. When earnings compound this way and capital returns scale with cash flow, the multiple resolves itself.

NVIDIA’s Edge Over Broadcom, AMD, and Amazon’s Trainium Broadcom (NASDAQ:AVGO) sells custom silicon into specific hyperscaler sockets. Advanced Micro Devices (NASDAQ:AMD) builds a credible accelerator. Amazon (NASDAQ:AMZN) has disclosed Trainium as a multibillion-dollar business. NVIDIA’s data center segment printed $89.02B in a single quarter. A multibillion-dollar Trainium line is a rounding item inside one NVIDIA reporting period. Intel (NASDAQ:INTC) competes on chips too, and now collaborates with NVIDIA on NVLink custom products. NVIDIA sells the CUDA software estate, NVLink fabric, Spectrum-X networking, and the Vera CPU on top of the accelerator. Networking grew 18% sequentially, with SpectrumX Ethernet up 2.6X year over year. That is the moat you cannot backfill by taping out one accelerator.

Risks on My Radar China data center compute revenue is fully excluded from forward guidance. Supply obligations sit at $279B, guarantee obligations reach $108.5B, and days sales outstanding stretched from 45 to 60 days as investment-grade customers took extended payment terms on multi-quarter shipments. If the AI capex cycle rolls over, those commitments become the headline. What keeps my capital active is that cloud-industry backlog exceeds $2 trillion, and top-five hyperscaler capex is guided at nearly $800 billion in 2026 and $1.3 trillion in 2027. All of that spend has to be powered, cooled, and networked by somebody, and we rounded up seven suppliers behind the buildout in a free report on the AI boom beyond the chipmakers. Demand is running well above what NVIDIA can supply at least through the end of fiscal year 28.

Why the Buy Button Stays Active Jensen Huang said it plainly on the call: “Now, compute is revenue.” Until the gross margin line breaks, my capital keeps landing on the same ticker.

Contact [email protected] for any questions or corrections.

Activest Wealth Management reduced its position in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 30.3% in the 2nd quarter, according to its most recent filing with the SEC. The firm owned 83,470 shares of the computer hardware maker’s stock after selling 36,321 shares during the period. NVIDIA accounts for approximately 3.2% of Activest Wealth Management’s investment portfolio, making the stock its 9th largest holding. Activest Wealth Management’s holdings in NVIDIA were worth $16,701,000 at the end of the most recent reporting period.

Other institutional investors and hedge funds also recently made changes to their positions in the company. Defender Capital LLC. lifted its position in NVIDIA by 0.7% during the 2nd quarter. Defender Capital LLC. now owns 7,534 shares of the computer hardware maker’s stock valued at $1,507,000 after purchasing an additional 50 shares during the period. Spectrum Financial Alliance Ltd LLC boosted its stake in shares of NVIDIA by 3.8% in the 1st quarter. Spectrum Financial Alliance Ltd LLC now owns 1,395 shares of the computer hardware maker’s stock valued at $243,000 after purchasing an additional 51 shares during the last quarter. LMG Wealth Partners LLC grew its position in shares of NVIDIA by 0.7% during the 4th quarter. LMG Wealth Partners LLC now owns 7,649 shares of the computer hardware maker’s stock worth $1,427,000 after buying an additional 53 shares during the period. Vision Financial Markets LLC raised its stake in shares of NVIDIA by 1.2% during the third quarter. Vision Financial Markets LLC now owns 4,640 shares of the computer hardware maker’s stock worth $866,000 after buying an additional 53 shares during the last quarter. Finally, JGP Global Gestao de Recursos Ltda. lifted its holdings in NVIDIA by 2.3% in the fourth quarter. JGP Global Gestao de Recursos Ltda. now owns 2,402 shares of the computer hardware maker’s stock valued at $448,000 after buying an additional 55 shares during the period. Institutional investors own 65.27% of the company’s stock.

Analysts Set New Price Targets A number of brokerages have issued reports on NVDA. TD Cowen reaffirmed a “buy” rating on shares of NVIDIA in a research note on Tuesday, August 18th. Wall Street Zen raised NVIDIA from a “buy” rating to a “strong-buy” rating in a research note on Saturday, August 29th. Craig Hallum raised their price target on NVIDIA from $245.00 to $275.00 and gave the stock a “buy” rating in a research report on Thursday, May 21st. DA Davidson reaffirmed a “buy” rating and set a $300.00 price objective on shares of NVIDIA in a research note on Thursday, August 27th. Finally, Robert W. Baird set a $500.00 price objective on NVIDIA and gave the company an “outperform” rating in a report on Thursday, May 21st. Two research analysts have rated the stock with a Strong Buy rating, fifty have issued a Buy rating and three have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $324.23.

Read Our Latest Analysis on NVDA Insider Activity at NVIDIA In other NVIDIA news, Director Mark A. Stevens sold 885,000 shares of the firm’s stock in a transaction that occurred on Thursday, June 18th. The shares were sold at an average price of $210.17, for a total transaction of $186,000,450.00. Following the sale, the director directly owned 5,207,271 shares in the company, valued at approximately $1,094,412,146.07. This trade represents a 14.53% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through this link. Also, EVP Timothy S. Teter sold 30,000 shares of NVIDIA stock in a transaction that occurred on Monday, August 31st. The shares were sold at an average price of $217.88, for a total transaction of $6,536,400.00. Following the completion of the transaction, the executive vice president directly owned 2,687,660 shares in the company, valued at approximately $585,587,360.80. The trade was a 1.10% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 1,563,501 shares of company stock valued at $335,380,530 over the last quarter. 3.94% of the stock is owned by insiders.

Trending Headlines about NVIDIA Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: Strong server demand supported by Dell: Dell Technologies’ stronger-than-expected results and raised guidance reinforced NVIDIA’s view that enterprise and hyperscaler spending on AI servers remains strong. NVIDIA’s stock is climbing as investors get more confidence in an expanding base of AI customers Positive Sentiment: Potential Hugging Face acquisition: Reports that NVIDIA is in advanced discussions to acquire AI platform Hugging Face for roughly $13 billion to $14 billion lifted expectations that the company could strengthen CUDA adoption, developer retention and recurring software revenue. The deal remains unconfirmed and could face integration and neutrality concerns. Why Nvidia’s $14 Billion Hugging Face Deal Would Make Total Sense Positive Sentiment: Expansion beyond GPUs: NVIDIA’s investments and partnerships with MediaTek, Equinix and optical-networking startup iPronics could extend its reach into custom AI chips, inference, automotive computing and data-center connectivity. An reported $35 billion Anthropic cloud commitment also highlighted continued demand for NVIDIA-powered compute. NVIDIA’s MediaTek Bet Shows How It Plans to Defend Its AI Moat Positive Sentiment: Analyst confidence remains high: J.P. Morgan reaffirmed a Buy rating and a $320 price target, citing strong AI-driven growth and expected demand for NVIDIA’s next-generation platforms. NVIDIA Buy Rating Reaffirmed NVIDIA Price Performance NVDA opened at $224.41 on Thursday. The stock has a market cap of $5.41 trillion, a P/E ratio of 28.37, a P/E/G ratio of 1.71 and a beta of 2.22. NVIDIA Corporation has a 12 month low of $164.07 and a 12 month high of $236.54. The company has a quick ratio of 3.85, a current ratio of 4.59 and a debt-to-equity ratio of 0.14. The company has a fifty day simple moving average of $209.20 and a 200 day simple moving average of $201.53.

NVIDIA (NASDAQ:NVDA – Get Free Report) last posted its earnings results on Wednesday, August 26th. The computer hardware maker reported $2.22 earnings per share for the quarter, topping the consensus estimate of $2.09 by $0.13. NVIDIA had a return on equity of 96.04% and a net margin of 63.66%.The firm had revenue of $96.22 billion for the quarter, compared to analyst estimates of $92.27 billion. During the same period in the previous year, the company posted $1.05 earnings per share. The company’s revenue for the quarter was up 105.9% on a year-over-year basis. On average, research analysts expect that NVIDIA Corporation will post 9.1 EPS for the current year.

NVIDIA Dividend Announcement The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, October 1st. Stockholders of record on Thursday, September 10th will be issued a dividend of $0.25 per share. This represents a $1.00 annualized dividend and a dividend yield of 0.4%. The ex-dividend date is Thursday, September 10th. NVIDIA’s payout ratio is 12.64%.

NVIDIA announced that its Board of Directors has approved a share repurchase program on Wednesday, May 20th that authorizes the company to buyback $80.00 billion in outstanding shares. This buyback authorization authorizes the computer hardware maker to purchase up to 1.5% of its stock through open market purchases. Stock buyback programs are typically an indication that the company’s leadership believes its stock is undervalued.

About NVIDIA (Free Report)

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.

See Also Five stocks we like better than NVIDIA Striking Oil: How the U.S. Play for Venezuela Fuels Supermajors J.M. Smucker Stock’s Rally Has More Than Tariffs Behind It Wendy’s Rally Fades After Trian Steps Back: Was It Ever Real? GitLab’s Earnings Beat Just Gave Software Bulls a New SaaSpocalypse Test Want to see what other hedge funds are holding NVDA? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for NVIDIA Corporation (NASDAQ:NVDA – Free Report).

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Nvidia stock NVDA climbed over 4% on Wednesday as a stronger-than-expected earnings report from Dell Technologies provided fresh evidence that spending on artificial intelligence infrastructure remains robust.

The move also came as broader US markets recovered after three consecutive sessions of losses.

The S&P 500 was up about 0.7%, while the Dow Jones Industrial Average gained roughly 0.9% and the Nasdaq Composite advanced about 0.5%.

Dell reported a stronger-than-expected quarter on Tuesday and raised its full-year revenue and earnings forecasts for the second time this year.

The company now expects fiscal 2027 revenue of $192 billion, up sharply from its previous forecast of $167 billion.

Its adjusted earnings-per-share forecast rose to $25.50 from $17.90.

The Infrastructure Solutions Group, which includes Dell's data-center hardware operations, generated $31.78 billion in quarterly revenue, an 89% increase from a year earlier and above the $29.61 billion consensus estimate.

AI-optimized servers generated $16.40 billion in revenue, slightly ahead of expectations and twice the level recorded a year earlier.

More striking was the strength of future demand.

Dell said AI server orders reached $60.9 billion during the quarter, while its AI-related backlog surged to $95 billion from $51.3 billion in the previous earnings report.

Dell also raised its fiscal 2027 forecast for AI-optimized server revenue to $74 billion from $60 billion.

"The AI momentum spoke for itself," said analysts at J.P. Morgan, pointing to Dell's record $60 billion of orders and $95 billion backlog.

The results are significant for Nvidia because Dell's AI servers incorporate Nvidia's processors and are being purchased by customers such as AI cloud providers Nscale and CoreWeave to build computing clusters used to train and run AI models.

That creates an important read-through for Nvidia.

Dell's growing order pipeline suggests demand for the infrastructure surrounding Nvidia's accelerators remains strong, rather than being limited to a handful of hyperscalers.

Dell has continued expanding its portfolio around Nvidia's latest technology.

The company unveiled servers powered by Nvidia's Blackwell Ultra chips last year and has said its systems will support Nvidia's Vera central processing units, which are expected to succeed its Grace server processor.

Dell also plans to support Nvidia's Vera Rubin platform, extending the relationship into future generations of AI infrastructure.

Morgan Stanley analysts led by Erik Woodring, head of US technology hardware equity research, said Dell's results show that AI spending remains strong and increasingly durable.

The analysts noted that Dell had essentially no AI-related revenue four years ago but now expects $74 billion in annual revenue from AI servers alone.

That shift illustrates how rapidly AI infrastructure has moved from an emerging market into a major source of hardware demand.

The Dell results arrive shortly after Nvidia's own fiscal second-quarter earnings, where the chipmaker offered investors an unusually strong longer-term outlook.

Nvidia said it expects revenue growth of 70% in fiscal 2028, significantly above analyst expectations for about 45% growth.

Nvidia is also widening its influence across the AI infrastructure stack through a new partnership with MediaTek.

Nvidia plans to invest $3.5 billion in convertible bonds issued by Taiwan-based MediaTek, while MediaTek will adopt Nvidia's NVLink Fusion platform.

The technology allows customers to develop customized processors that can connect to Nvidia's NVLink-based rack-scale AI systems.

The partnership could help Nvidia participate in the growing custom-chip market without having to design every accelerator itself.

Supply-chain analyst Ming-Chi Kuo said MediaTek can develop customized chips for customers while Nvidia provides the connectivity and rack-scale infrastructure needed to integrate those processors into AI systems.

The two companies will also continue working together on future generations of Nvidia's RTX Spark and DGX Spark platforms, as well as technologies for AI-powered vehicles.

"Nvidia is just covering all its bases here & abroad," said Paul Meeks, head of technology research at Freedom Capital Markets in a MarketWatch report.

He added that Nvidia was "continuing to boost its influence in the AI infrastructure ecosystem even beyond" its graphics processing units.

Meanwhile, Nvidia recently received a fresh bullish commentary from JPMorgan, the most conservative bank, which lifted its price target to $320 from $280 while maintaining an Overweight rating.

JPMorgan analyst Harlan Sur recently met with Nvidia's Toshiya Hari, vice president of investor relations and strategic finance, who said the 70% growth framework reflected broad-based demand across these customer groups.

The company also said it had offered an out-year forecast because it sees a meaningful gap between Wall Street estimates and its own internal projections.

Nvidia's recent financial performance reinforces that confidence.

Revenue has grown 83% over the past 12 months, while 35 analysts have raised earnings estimates for the upcoming period.

Perhaps more importantly, Nvidia continues to describe its business as supply-constrained rather than demand-constrained.

Hari indicated that without supply limitations, Nvidia's business could potentially more than double year over year.

The composition of AI workloads is also changing.

Hari said the mix between training and inference revenue was roughly 50/50 about 18 months ago.

Nvidia now believes inference has become the larger part of the business and expects its share to continue increasing.

That shift could extend the AI infrastructure cycle because inference involves the repeated use of trained models for applications ranging from AI agents to enterprise software and consumer services.

The implication for Nvidia is that demand may increasingly come not just from building increasingly powerful AI models, but from deploying them at scale.

Valencia, Spain-based startup iPronics said Tuesday that it has raised $125 million in venture capital with participation from Nvidia (NVDA.O) ​to shrink a new type of data center networking chip ‌that could connect hundreds of thousands of computing chips.

iPronics is developing what is called an optical circuit switch, a type of switching chip made popular in data centers ​by Alphabet's Google (GOOGL.O) for its role in wiring up its AI ​supercomputers. Google's success with the switches has inspired a wave of ⁠startups to bring them to the outside world.

The key benefit of the ​OCS is the ability to quickly adjust to a new path around ​a computing chip that has burned out, something that has become inevitable as data centers house hundreds of thousands of chips.

"The failures are happening on a 'minute' time scale — ​it's not in the hours or months or weeks any more," ​Daniel Pérez-López, founder and chief technical officer of iPronics, told Reuters in an interview. "The ‌first motivation ⁠is to have resilience — a resilient and reliable network that is able to basically rewire itself."

iPronics is hoping to keep that technological benefit while shrinking the size of the OCS equipment by about 20-fold from current ​sizes in order ​to fit more ⁠switches in a server rack. The company has been shipping its switches for about a year and said ​it is working with large AI infrastructure providers that ​it declined ⁠to name.

The funding round was by co-led by Maverick Silicon and Light Street Capital, with participation from new and existing investors including Triatomic Capital, Bosch ⁠Ventures, ​Catalight Capital and the European Innovation Council ​Fund. iPronics, founded in 2019 as a spin-off from Technical University of Valencia, has raised $177 million ​to date.

Anthropic has agreed to a $35 billion deal to buy computing power from Nvidia-backed cloud provider Lambda, the Wall Street Journal reported, citing unnamed sources.

The new capacity will be sourced from a Texas data center operated by bitcoin miner Hut 8, with Nvidia holding the underlying lease on the property, according to the report.

The arrangement is the latest example of the tangled web of deals reshaping the AI industry, with Nvidia serving simultaneously as landlord, chip supplier and facilitator across the transaction. Anthropic has now signed $175 billion in cloud deals in recent months as it looks to secure computing capacity ahead of an anticipated supply crunch.

The capacity for the Anthropic-Lambda deal will run through Hut 8's Beacon Point campus in Nueces County, Texas. Hut 8 had previously signed two 15-year leases covering 704 megawatts at the campus with an investment-grade customer later identified as Nvidia, which holds the primary facility lease. Those underlying contracts carry $19.6 billion in base-term contract value for Hut 8.

Once fully operational, the 704-megawatt Beacon Point campus is expected to generate an average of $1.31 billion in annual operating income for Hut 8.

Under the structure of the deal, Anthropic pays Lambda, Lambda installs Nvidia hardware, and Nvidia pays Hut 8 the underlying facility rent, a setup that guarantees Hut 8's long-term infrastructure revenue regardless of specific compute utilization.

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NVDA buy

Buy Nvidia (NVDA). Earnings/guidance momentum is the core: revenue +106% YoY to $86B, current-quarter revenue guide to $108B, and management’s conservatism implies upside beyond that. Add the $35B Anthropic-related GPU buildout via Lambda/Hut 8 (350MW) as a near-term demand signal. Valuation is the kicker: forward P/E ~23 vs its 5-year average ~42, so the market is still underpricing the growth. Technicals support continuation: above 50-week EMA, Supertrend, and the rising trendline—setup for a push toward $300.

Key Risk: Guidance disappoints next quarter and the market decides the current growth run-rate can’t be sustained.

NVDA buy on buybacks

Buy NVDA specifically for the EPS/float effect from buybacks. With $26B repurchased in Q2 and $99B remaining, the share count is shrinking (24.15B vs 25.06B in 2022), mechanically lifting EPS even if revenue growth merely matches guidance. This amplifies any upside surprise from the current-quarter guide and keeps the stock bid during pullbacks.

Key Risk: Regulatory or legal action forces Nvidia to slow/stop buybacks, removing the EPS support.

Nvidia stock has pared back some of the gains from last week's strong earnings. Shares soared to $230 before pulling back to $220 today, even as several major announcements hit the wires. Several key catalysts now point toward the potential for a strong rebound.

Nvidia, the biggest company in the world, has made some important announcements that may boost its stock in the near term. One of the deals came today, when Lambda, a company that Nvidia backs, announced a $35 billion deal with Anthropic. This project is being developed by Hut 8, will have 350 megawatts, and will use Nvidia GPUs and other products. 

In addition to this, Nvidia announced strong financial results last week. Its revenue jumped by 106% in the last quarter to $86 billion and boosted its forward guidance. It also predicted that its revenue will jump to $108 billion in the current quarter. 

Based on its historical performance, this means that its revenue will be higher than its guidance. In this case, chances are that it will make over $112 billion since management tends to be highly conservative. The same will happen in terms of its earnings.

Further, and most importantly, the company’s guidance was stronger than expected. Its revenue for the next financial year is expected to grow by 77%, higher than the 44% that analysts were expecting. 

This growth has helped the company to repurchase millions of shares. It repurchased shares worth $26 billion in the second quarter and has $99 billion remaining in its obligation. Nvidia has reduced its outstanding shares to 24.15 billion, much lower than 25.06 billion in 2022.

Share repurchases helped to boost a company’s performance by increasing the earnings-per-share (EPS). This happens as the company reduces the number of shares in circulation, which also boosts the amount of dividends they receive. 

In the perfect space, a company like Nvidia that is growing this fast and has a strong market share should have a high valuation multiple. This is not the case with Nvidia, a company whose valuation metrics are in line with the broader market.

The company has a forward price-to-earnings ratio of 23, much lower than its five-year average of 42. This multiple is also in line with that of the S&P 500 Index.

At the same time, the company has a Rule of 40 multiple of 128% based on the free cash flow margin. Based on the operating and net margins, the multiple is 172% and 168%, respectively. A company is said to be cheap whenever the multiple is above 40%.

These fundamentals explain why analysts are highly bullish on the company, especially after the last earnings report. The average estimate among analysts is $322, up by nearly 50% from the current level. The most bullish analyst is Raymond James’ Simon Leopold who has a target of $515. 

Nvidia stock chart | Source: TradingView

The weekly chart shows that Nvidia shares have stalled in the past few weeks. It has remained above the 50-week exponential moving average (EMA) and the Supertrend indicator. 

The stock is also above the ascending trendline that links the lowest level since May 5 this year. Therefore, the most likely scenario is where the stock continues rising, potentially to the psychological level of $300. 

Logistics company OneRail is launching a platform using Nvidia's artificial intelligence software to help retailers make faster decisions on the most efficient delivery options at scale, CNBC has learned.

The new platform, called OmniStar, allows retailers to use AI to evaluate all of their delivery options and identify the best one for each individual order, using OneRail's proprietary data.

The last-mile delivery company told CNBC the new platform will allow smaller companies to deliver at scale and improve margins to compete with the retail giants of the world, including Amazon and Walmart.

As e-commerce grows, retailers have had to keep up with surging demand and invest in nimble supply chains to optimize their efficiency. But those manual processes are often fragmented across the retailer and the logistics businesses.

"If you don't have the ability to make lightning-fast decisions, you're giving up margin," OneRail CEO Bill Catania told CNBC. "Last-mile fulfillment is expensive."

Where choosing the best routing for a package may have previously taken 20 minutes, OneRail said its platform can do it in two and a half minutes leveraging AI. That time saved means retailers can operate larger, faster and more precise supply chains, Catania said.

"That's where the artificial intelligence comes in. It's making those kinds of decisions extremely rapidly, and so to do that, that's where the Nvidia hardware and the software comes in and really makes this thing work at scale," said David Daeschler, the head of AI at OneRail.

Daeschler said the company began partnering with Nvidia three years ago to explore ways to incorporate AI into the logistics process.

"The result is a real-time decision layer that can route an order to the right carrier and delivery mode at the right cost, rather than relying on static rules or manual planning," said Azita Martin, Nvidia's vice president and general manager of retail and consumer packaged goods.

Catania said OneRail's proprietary data, which includes a network of more than 12 million drivers and over 1,000 logistics partners, is being used to train the AI on the most efficient routes and delivery options.

"It's for the benefit of them and us: We operate more efficiently. They save money and provide a better customer experience," Daeschler said.

The company told CNBC its platform has already been deployed with some customers, including a large tire distributor that saw OmniStar save the company a run rate of $40 million over three years because it's able to use its resources more efficiently.

It's also estimating the platform will surpass $6 billion in gross merchandise volume in the fourth quarter.

Nvidia's Martin said the platform will allow retailers to make much faster decisions.

"For retailers, the bigger value is the ability to evaluate more scenarios, respond more quickly as conditions change and improve delivery economics without sacrificing service," Martin said.

OneRail said the platform could help smaller retailers compete more effectively on delivery speed and efficiency.

OneRail announced a partnership earlier this year with FedEx to bring same-day delivery services to all of its customers, joining a race of retailers trying to offer their customers the best and fastest delivery options. That partnership will now allow OneRail to better work with smaller businesses as well, Catania added.

"We're kind of doing for delivery what ChatGPT and Anthropic have done for words – it all works the same way," Daeschler said. "They give people more access to knowledge. We're giving people access to being able to do delivery in a way that's affordable. … That's all done based on original models, training on data that we have, just like words on the internet."

Nvidia announced a program to collect revenue on the same chip twice, once at sale and again through ongoing cloud profits, then paused it weeks later after internal warnings about antitrust exposure. The retreat raises a question the market has…

NVIDIA’s (NASDAQ:NVDA | NVDA Price Prediction) $96.22 billion quarter and 105.85% revenue growth would normally end the conversation. Instead, management disclosed a plan to earn a second time on every chip sold to smaller cloud providers. Days later, parts of the initiative had been paused less than two months after its announcement, with some employees warning internally about potential antitrust scrutiny.

NVIDIA still runs the most profitable franchise in semiconductors, but the speed of the retreat is the story worth examining.

How the Same Chip Was Supposed to Pay Twice The mechanism is unusual. NVIDIA would guarantee or rent unused capacity from a smaller cloud provider, which gave lenders the certainty needed to finance the hardware purchase.

CFO Colette Kress described it directly on the call: “NVIDIA provides a take or pay commitment on a portion of the facility’s capacity, a minimum revenue guarantee that gives lenders the confidence to underwrite the project, and in exchange, we share in a portion of the Neocloud’s revenue earned above that floor.”

Above the guaranteed floor, NVIDIA would collect 50% of cloud revenue. Management summarized the economics without euphemism: “In this model, we get paid twice, once on the hardware sale and again through the share of rental revenue.”

A capital-starved cloud provider gets financeable, NVIDIA books the sale, and then rides the utilization curve on hardware it already sold. The structure effectively converts a one-time transaction into a recurring revenue stream tied to compute usage, without requiring NVIDIA to operate the infrastructure itself.

Why the Math Was Too Good to Ignore NVIDIA does not need this program to justify its $5.25 trillion market cap. Data Center revenue was $89.023 billion last quarter, up 117%.

But the second revenue stream would layer recurring economics onto a transactional business. Management said it could “drive billions in revenue over the medium to long term.”

It also unlocks a customer tier that hyperscalers cannot serve. Jensen Huang argued the non-hyperscaler market is “half of the picture” and largely invisible to investors.

NVIDIA’s $108.5 billion in guarantee obligations and a partnership with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR to mobilize over $500 billion in third-party capital show the scale of ambition. Kress said balance-sheet-supported labs would account for “roughly a quarter of our business next year.”

Where the Antitrust Problem Starts The problem is control. If NVIDIA decides which providers get guaranteed capacity, it also decides which providers can borrow, build, and compete.

Management preempted the criticism: “We recognize the scale of this support, and we know some will call this circular financing. We see it differently.”

Seeing it differently is not the same as regulators seeing it differently. Internal warnings about antitrust exposure preceded any external agency review, which is telling.

Huang leaned on fungibility as the risk answer: “The NVIDIA Compute platform is fungible and durable and can be redeployed to support other customers.”

That defends NVIDIA’s downside but does not defend against the argument that the company is picking winners in the downstream compute market it already dominates on the supply side. Regulators tend to focus on gatekeeping power rather than on whether the gatekeeper can find alternative buyers, and that distinction is where the program becomes vulnerable.

What the Pause Actually Signals Pausing a program within weeks of announcing it is the kind of decision a legal team forces on a strategy team. The initiative is not dead. It could be redesigned, narrowed, or folded into the broader third-party capital platform.

Shares closed at $217.55, up 14.49% over the past month. Analysts have an average target of $305.79, with 48 buy ratings and 2 holds.

The market is not pricing regulatory risk here, which is itself a position worth questioning at 26x forward earnings. Riding an AI rally is fine as long as you have thought through the exit, and we made the case for both halves in a free bubble survivor’s handbook.

NVIDIA found a genuinely clever way to unlock demand that would not otherwise exist, but the design pushed control one step further than a dominant supplier can comfortably go. Watch whether the revenue-share language returns in narrower form, or whether the $500 billion third-party capital vehicle quietly absorbs what the direct guarantees were meant to do.

Contact [email protected] for any questions or corrections.

Nvidia (NVDA) stock rose toward a buy point Monday, capping off a winning August after the artificial intelligence chipmaker this month broke out following a beat-and-raise report for its second quarter.

With a market cap of $5.2 trillion, Nvidia has reclaimed its crown as the most valuable company on the stock market. Apple (AAPL) was knocked off that perch recently after the stock sold off following its earnings report in July. So, is Nvidia stock a buy or sell now?

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Chip Stocks Got Too Hot. Now What?

Franklin Equity portfolio manager Jonathan Curtis breaks down why he believes the semiconductor selloff doesn’t signal a downturn, with AI demand remaining strong, chip supply still constrained and hyperscaler spending continuing to support the trade.

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Chip Stocks Got Too Hot. Now What?

On Friday, famed investor Cathie Wood's ARK Invest bought 243,707 Nvidia shares valued at around $53 million.

Late Wednesday, the AI giant posted second-quarter adjusted earnings of $2.22 a share on sales of $96 billion, up about 120% and 106% year over year, respectively. Wall Street had targeted earnings of $2.08 and $92 billion in sales. The company's current-quarter revenue projection of $108 billion topped views by $3 billion.

Management noted supply constraints through fiscal 2028 that will allow Nvidia to meet 70% of demand. Meanwhile, Chief Financial Officer Colette Kres said Nvidia's circular financing will lead to two payoffs: through its hardware sales and from its revenue share at its partners.

Partnership With Amazon
The company also solidified its partnership with Amazon (AMZN), with the e-commerce company ordering 2 million of Nvidia's processors and adopting its full-stack physical AI platform to enable its warehouse robot fleet.

Following the conference call, analysts Quinn Bolton, Neil Young and others at Needham noted that data centers – the end-market that could be Nvidia's biggest growth engine – will continue to undergo a shift toward accelerated computing and AI.

Bolton raised his targets for the third quarter to $2.46 per share and sales of $109 billion. He previously expected earnings of $2.34 and $103 billion in sales. Needham has a price target of 300 for Nvidia stock with a buy rating.

In terms of its 12-month price performance, Nvidia has outperformed just 59% of all other stocks in Investor's Business Daily's database.

Funds own 42% of the company's outstanding shares, according to IBD MarketSurge research. The stock's Accumulation/Distribution Rating of D- indicates funds have been net sellers of the stock recently. The rating measures price and volume action over the last 13 weeks.

But the AI chip behemoth has a top-level Earnings Per Share Rating of 99. Further, the stock's all-around strength, or Composite Rating, is 91.

Is Nvidia Stock A Buy?
Looking at chart signals and technical measures can help investors assess whether Nvidia stock is a buy or sell now.

Nvidia stock on Thursday broke out of a cup-with-handle with a 227.92 buy point following an earnings beat. The stock is below the pivot on Monday.

Please follow VRamakrishnan on X/Twitter for more news on the stock market today.

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