Prediction: Nvidia Stock Is Going to Soar After Nov. 17
Nvidia(NASDAQ: NVDA) has been one of the stock market's biggest winners over the last several years. Its market cap now tops $5 trillion, and the stock is still on the rise -- it's up nearly 15% in 2026 so far.
Investors who bought the stock three years ago are sitting on a whopping 429% return. Stretch that timeline to five years, and Nvidia is up 759%.
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Those are outstanding returns, but I don't think Nvidia is finished rewarding shareholders. In fact, I believe it could have another big move coming after the chipmaker reports its fiscal 2027 third-quarter earnings on Nov. 17.
Here's why I'm bullish on Nvidia stock heading into its next earnings report.
Nvidia's growth isn't slowing down
It's difficult to appreciate just how quickly Nvidia is growing until you look at the numbers.
The company generated $96.2 billion in revenue during its fiscal 2027 second quarter, which ended July 26. That was a 106% increase from the prior-year period, with data center revenue climbing 117% to $89 billion.
And Nvidia is making an enormous amount of money on those sales.
Its non-GAAP gross margin reached 75%, meaning Nvidia retained 75 cents of every revenue dollar after accounting for the direct costs of producing its products. Adjusted earnings per share increased 120% to $2.22.
Those aren't the financial results of a company whose best days are necessarily behind it.
For the fiscal third quarter, Nvidia is forecasting revenue of approximately $108 billion, representing another substantial increase from the $57 billion it generated a year earlier.
Wall Street expects even more. According to Yahoo! Finance, analysts are projecting revenue of approximately $109 billion and adjusted earnings of $2.47 per share. That would amount to revenue growth of roughly 91% and earnings growth of 90% from the year-ago quarter.
Nvidia has already demonstrated that it can deliver extraordinary growth even at its now enormous scale. Another strong quarter, particularly if management raises its outlook, could give investors another reason to push the stock higher.
Jensen Huang sees an enormous opportunity ahead
Nvidia CEO Jensen Huang has been bullish about the company's future, and his confidence isn't limited to its potential to sell more graphics processing units (GPUs).
Huang believes global spending on AI infrastructure could reach $3 trillion to $4 trillion by 2030. He has also indicated that Nvidia expects to sell twice as many chips in 2027 as it does in 2026.
Earnings from big tech companies give Nvidia investors a lot to look forward to. Meta Platformsraised the low end of its 2026 capital spending range from $135 billion to $145 billion, Alphabetheld its $195 billion to $205 billion capex budget range steady, and Microsofttrimmed its 2026 plan slightly from $175 billion to $170 billion.
However, Alphabet also said it expects spending to rise significantly in 2027, and Microsoft's CFO said she expects spending to accelerate in the first half of 2027 on higher component costs and delayed deliveries. Amazon, which reported its latest results after the closing bell on Oct. 29, also reaffirmed its plan to spend $220 billion this year.
As a group, hyperscalers are expected to spend more than $1 trillion on capex next year, and since these companies are among Nvidia's biggest customers, budgets that hold steady or rise support its demand picture heading into its report after the close on Nov. 17.
But there's another part of Nvidia's growth story that I find particularly compelling. The company's next-generation Vera Rubin architecture is designed to deliver more computing power from each gigawatt of electricity it consumes. And Nvidia expects the platform to generate considerably more revenue for each gigawatt of computing capacity.
Huang explained during the company's August earnings call that Nvidia's revenue opportunity increased from approximately $18 billion per gigawatt with its Grace Hopper platform to $25 billion with the Grace Blackwell platform that succeeded it in late 2024. With the new Vera Rubin platform, that figure could reach $40 billion.
That's a 60% increase from Blackwell, without requiring its data center customers to add more electrical capacity.
If customers continue buying Nvidia's increasingly sophisticated AI systems, the company has an opportunity to grow revenue at a faster rate than it grows its chip shipments.
Nvidia's valuation looks surprisingly reasonable
Despite its incredible stock performance, Nvidia trades at approximately 23 times forward earnings. That's a premium to the S&P 500's forward price-to-earnings ratio of 18.6, but I believe it's extremely reasonable given Nvidia's growth.
Remember, analysts expect Nvidia's earnings to grow by approximately 95% during fiscal 2027. They're also forecasting another 71% increase in fiscal 2028.
With Wall Street already expecting nearly $109 billion in quarterly revenue, Nvidia has a high bar to clear. Moreover, even an earnings beat doesn't guarantee a stock rally if investors are disappointed by management's guidance.
But I'm not particularly worried about Nvidia's premium valuation. We're talking about a company that's more than doubling quarterly revenue, maintaining gross margins around 75%, and preparing to sell increasingly valuable AI computing systems. Paying 23 times forward earnings for that kind of performance doesn't strike me as excessive.
But with AI infrastructure spending continuing, Nvidia's earnings growing rapidly, and its valuation looking reasonable relative to its prospects, I believe the odds favor another strong performance from Nvidia in its next earnings report.
That's why I'm bullish on Nvidia heading into Nov. 17 -- and why I think shares could climb substantially afterward.
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Patrick Sanders has positions in Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy .
Prediction: Nvidia Stock Is Going to Soar After Nov. 17 was originally published by The Motley Fool
