Nvidia Just Rejoined Apple and Microsoft in the $3 Trillion Club. Could It Become the First $4 Trillion Stock by 2026?

Core Viewpoint - Nvidia has rejoined the $3 trillion market cap club, raising speculation about its potential to become the first $4 trillion stock by 2026 [1][4]. Group 1: Market Cap and Valuation - Nvidia first reached a market cap of $3 trillion in June 2024 and maintained it for eight months before a sell-off [1]. - Nvidia's shares trade at 26.9 times forward earnings, which is lower than Microsoft's 30 times and Apple's 27 times, suggesting more room for growth [5]. Group 2: Growth Prospects - Wall Street anticipates Nvidia's earnings to grow by approximately 47% this fiscal year and 29% in the next fiscal year, outperforming Apple and Microsoft [7]. - Apple's earnings are expected to increase by 18% this year and 9% next year, while Microsoft's growth is projected at nearly 14% this year and 13% next year [7]. Group 3: Trade and Economic Factors - Nvidia's stock decline was significantly influenced by the Trump administration's trade restrictions on GPU exports to China, leading to a $5.5 billion writedown [2]. - Recent positive signals regarding lower Chinese tariffs and a 90-day pause on some tariffs have contributed to Nvidia's stock rebound [3]. - Despite optimism, the potential for significant tariffs and an economic slowdown could still impact Nvidia's business and demand for its GPUs [9][10]. Group 4: Future Outlook - Nvidia's market cap would need to increase by roughly 25% to reach $4 trillion, a target that could be achievable in the next 18 months, though various factors may complicate this timeline [11].