Why Nvidia’s Stock Might Soar After May 28

Even though its stock price dropped 22% from its highest point because people are worried about trade problems between countries, there are good reasons to believe Nvidia’s stock could go up a lot after its next big financial report on May 28.

Why Nvidia’s Stock Might Jump After May 28

• Nvidia’s Chips Are in High Demand:
  Nvidia’s H100 chip was the most popular for AI work in 2023, giving Nvidia almost complete control of that market. Now, the company is about to release a new chip called the Blackwell Ultra GB300, which can be up to 50 times faster than the H100 in some situations. This is important because new types of AI need much more computer power to work well and quickly.
• Big Customers Are Still Spending:
  The four biggest tech companies-Meta (Facebook), Amazon, Microsoft, and Alphabet (Google)-plan to spend about $320 billion this year on AI data centers and chips. Even though some people worried that trade issues would make them spend less, these companies have not cut their budgets. In fact, Meta even raised its planned spending.
• What to Watch for on May 28:
  Nvidia expects to report about $43 billion in sales for the first quarter of its 2026 financial year, which would be 65% more than last year at the same time. Most of this money comes from selling AI chips for data centers.
  Experts also think Nvidia will report earnings per share (a measure of profit) of $0.89, which would be 46% higher than last year.
  After this report, everyone will be looking to see if Nvidia expects to keep growing. If Nvidia predicts sales of about $46.4 billion for the next quarter, that would be a good sign. If the forecast is lower, the stock might drop for a while.

Why the Stock Is Still a Good Deal

• Stock Price Compared to Profits:
  Right now, Nvidia’s stock price is about 40 times its earnings per share from last year. This is actually cheaper than its usual average over the past 10 years, which was almost 60 times earnings.
  If Nvidia earns as much as experts expect next year, the stock would be even cheaper compared to its profits. This means there’s room for the stock price to go up.
• Looking to the Future:
  Nvidia’s CEO, Jensen Huang, thinks that by 2028, companies around the world will spend $1 trillion every year on data centers, mostly because of the growing need for powerful AI chips.
  Nvidia is also working on a new chip called Rubin, which could be more than three times faster than the Blackwell Ultra. This shows Nvidia is planning to stay ahead in the AI race for years.

Bottom Line

Nvidia’s business is strong, and its new chips are much faster than before. Its biggest customers are still spending lots of money, and its stock is cheaper than usual compared to its profits. If the company’s report on May 28 is good, the stock could rise quickly, and Nvidia could continue to lead the AI world for a long time.

The information provided in this content is for informational and educational purposes only and should not be construed as financial, investment, or trading advice. The author may hold positions in some of the securities or assets discussed. Past performance is not indicative of future results.