Does Nvidia Stock Still Have Enough Mojo to Buy?

Nvidia reported a blockbuster Q3 with revenue up 62% y/y to a record $57 billion and EPS up 60% to $1.30, including an unusually strong 22% sequential jump from $46.74 billion, but the post-earnings pop faded into a ~3% intraday decline below the $184 50-day as investors fretted about an AI bubble and China export restrictions. Management said Blackwell GPUs are selling out on cloud platforms, raised Vera Rubin’s launch to Q3 2026, and pointed to accelerating AI training/inference demand and partnerships (OpenAI, Uber, xAI) that blunt competitive worries. Guidance for Q4 of roughly $65 billion (+/-2%) handily tops Street estimates, analysts have been lifting price targets (Zacks average $239.49, Loop Capital $350), and EPS revisions are trending higher, leaving a favorable growth outlook despite an elevated 41x forward multiple and near-term sentiment risks.

Analysis

Nvidia reported Q3 revenue of $57.0 billion, up 62% year-over-year, and EPS of $1.30, up 60%, with both metrics beating consensus by more than 4%. The top line also rose sequentially 22% from $46.74 billion last quarter—one of the largest quarterly jumps in the company's history—signaling abrupt acceleration in demand. Despite the print, NVDA's post-earnings move reversed from an initial +5% spike to roughly a 3% intraday decline and traded below its 50-day moving average of $184 as investors weighed AI bubble concerns and export restrictions to China.

Management said Blackwell GPUs are sold out on cloud platforms and issued Q4 revenue guidance around $65 billion (+/-2%), well above Street expectations of $60.57 billion, while moving the Vera Rubin platform launch to Q3 2026; partnerships with OpenAI, Uber and xAI underpin hyperscale and enterprise demand. EPS revisions for fiscal 2026 and FY27 have trended higher, reinforcing revenue-driven momentum but making timely execution critical.

Nvidia currently trades at about 41x forward earnings—below its decade high of 118x but near a decade median of 45x—with a Zacks average price target of $239.49 (~28% upside) and Loop Capital’s street-high $350 view. Key risks that would materially change the outlook are renewed sentiment-driven de-ratings, concrete export-control actions affecting China exposure, or any failure to convert Blackwell cloud demand into sustained shipments and revenue.

Key Decisions for Investors

• Consider initiating or adding to a disciplined long position on NVDA on weakness below the 50-day moving average ($184), given the 62% y/y revenue beat to $57B and raised Q4 guide to ~$65B, while sizing positions to reflect a 41x forward valuation
• Use hedges or options to protect against sentiment-driven downside from AI bubble fears and potential China export restrictions, monitor near-term catalysts such as confirmation of Blackwell GPU shipments and Q4 guide execution
• Reassess exposure if EPS revisions stop rising or guidance is trimmed; specifically watch sequential revenue trends (the 22% q/q gain) and company commentary on supply constraints
• Watch analyst targets (Zacks avg $239.49 and Loop Capital $350) for momentum and profit-taking levels, and consider scaling out into strength given stretched multiples relative to historical medians