The Staggering Number That Shows Why Nvidia Is Still a Buy

Core Viewpoint - Nvidia's strong financial performance and growth projections indicate that its stock is undervalued and presents a buying opportunity, especially with anticipated revenue growth driven by AI demand [1]. Financial Performance - Nvidia reported Q3 revenue of $57 billion, a 62% increase year-over-year and a 22% increase sequentially [1]. - Data Center revenue, primarily driven by AI, reached $51.2 billion, up 66% year-over-year and 25% from the previous quarter [1]. - The company guided Q4 revenue to be around $65 billion, with analysts expecting a consensus of $65.6 billion [1]. Growth Projections - Goldman Sachs projects Nvidia's revenue to reach $513 billion by 2028, significantly higher than the $400 billion consensus, representing a 53% compound annual growth rate from fiscal 2026 estimates of approximately $215 billion [1]. - Nvidia is expected to generate over $1 billion in sales daily at the projected 2028 revenue level [1]. Valuation Metrics - Nvidia's current forward P/E ratio is approximately 24, which is close to the S&P 500's multiple and has not been seen in nearly a year [1]. - The PEG ratio is under 0.5, indicating significant undervaluation relative to its projected earnings growth [1]. Market Context - Despite Nvidia's strong earnings, the stock has remained range-bound around $180 per share since August, attributed to concerns over AI spending and supply constraints [1]. - The anticipated strong demand for AI infrastructure and Nvidia's dominance in the GPU market suggest that the stock is likely to rise significantly in the near future [1].