Nvidia (NVDA) Surges Toward $5 Trillion Valuation on AI Expansion and Investor Backing
Nvidia (NVDA, Financials) rallied 45% since its April low, supported by easing tariff concerns and investor excitement over its widening role in the AI ecosystem. The company is set to report first-quarter fiscal 2026 results after the close, with Wall Street expecting a 66% year-over-year revenue increase.
Revenue forecasts and market momentum have been further lifted by Nvidia’s new partnership with Saudi Arabia’s HUMAIN to build AI factories powered by 18,000 Grace Blackwell GB300 superchips. The move deepens Nvidia’s foothold in emerging markets and aligns with Saudi Arabia’s broader AI ambitions.
KM Capital, a top 4% investor on TipRanks, views Nvidia’s physical AI initiativessuch as autonomous tech and roboticsas a major long-term driver. The chipmaker has recently partnered with General Motors, Uber, and Volvo to extend its influence in the automotive sector.
Morgan Stanley projects the robotic humanoid market could hit $5 trillion by 2050. Nvidia’s early entrance and first-mover advantage in the space give it long-term upside, according to KM, who forecasts the company can maintain a 7% constant growth rateenough, by his calculations, to hit a $5 trillion valuation.
Generative AI remains a near-term revenue driver. KM points to strong enterprise spending projections in AI/ML over the next year, and notes that Taiwan Semiconductor’s recent price hikes confirm robust chip demand. “The ability to raise prices is a bullish indicator,” he said.
Despite Nvidia’s surge, KM contends the stock is still undervalued and considers it a no-brainer Strong Buy. The view is broadly shared by Wall Street, where Nvidia has 32 Buy, 4 Hold, and just 1 Sell rating, giving it a Strong Buy consensus.
Analysts’ 12-month average price target of $164.21 implies ~20% upside from current levels. With AI infrastructure deployments accelerating and demand surging across sectors, Nvidia’s competitive moat continues to deepen.
Investors will be watching today’s earnings and any updates on global partnerships or AI product rollouts. Those factors could further strengthen the bull case heading into the second half of fiscal 2026.
This article first appeared on GuruFocus.
