Ten public companies have achieved a market value exceeding $1 trillion as of June 16. They are listed below in descending order based on upside implied by the median target price set by Wall Street analysts.
- Nvidia (NVDA +0.19%) has a median target price of $175 per share. That implies 21% upside from its current share price of $145.
- Apple has median target price of $235 per share. That implies 18% upside from its current share price of $198.
- Broadcom has a median target price of $290 per share. That implies 15% upside from its current share price of $252.
- Alphabet has a median target price of $200 per share. That implies 13% upside from its current share price of $177.
- Amazon has a median target price of $240 per share. That implies 11% upside from its current share price of $216.
- Microsoft has a median target price of $510 per share. That implies 6% upside from its current share price of $479.
- Taiwan Semiconductor Manufacturing has a median target price of $225 per share. That implies 4% upside from its current share price of $216.
- Berkshire Hathaway has a median target price of $490 per share. That implies 0% upside from its current share price of $490.
- Meta Platforms has a median target price of $700 per share. That implies less than 1% downside from its current share price of $702.
- Tesla has a median target price of $306 per share. That implies 7% downside from its current share price of $329.
Wall Street clearly sees Nvidia as the best trillion-dollar stock to buy right now. Here's what investors should know about the chipmaker.
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Nvidia is a market leader in AI chips and networking gear
Nvidia is the market leader in data center graphics processing units (GPUs), chips used to accelerate artificial intelligence (AI) training and inference tasks. The company is also the market leader in InfiniBand networking equipment, the leading connectivity technology for back-end AI networks.
Importantly, Nvidia has struggled with two headwinds throughout the year. First, Chinese start-up DeepSeek developed sophisticated large language models using fewer GPUs than U.S. competitors, causing investors to worry demand would decline. Second, the Trump administration restricted the export of H20 GPUs built for the Chinese market, effectively preventing Nvidia from operating in the country.
Nvidia more or less put the first concern to rest with impressive first-quarter financial results that exceeded expectations on the top and bottom lines. Revenue increased 69% to $44 billion due to what CEO Jensen Huang characterized as "incredibly strong" demand for Nvidia AI infrastructure. And non-GAAP (adjusted) net income jumped 33% to $0.81 per diluted share.
However, while first-quarter results show robust demand, export controls still hurt Nvidia. The company took a $4.5 billion charge due to excess H20 inventory, and adjusted earnings would have increased 57% to $0.96 per diluted share had the Trump administration not imposed new restrictions. Huang also said the company will miss out on $8 billion in sales in the July-ending quarter.
Nevertheless, Morgan Stanley believes the downside related to export restrictions is fully priced into the stock and that Nvidia will eventually be able to participate in the Chinese market to some degree. "China is entirely derisked, at least for direct shipments, and we are optimistic that there will be some path to monetize at least a portion of that demand," analysts wrote in a recent note.
Grand View Research estimates the data center GPU market will expand at 28.5% annually through 2030, while spending across AI hardware, software, and services increases at 35.9% annually during the same period. Nvidia is exceptionally well positioned to benefit from that explosive growth.
NASDAQ: NVDA
Key Data Points
Nvidia stock trades at a reasonable price
Wall Street expects Nvidia's adjusted earnings to increase at 40% annually through the fiscal year ending January 2027. That makes the current valuation of 45 times adjusted earnings look reasonable, especially when Nvidia beat the consensus estimate by an average of 4% in the last six quarters.
As a caveat, the semiconductor industry is cyclical, meaning Nvidia's sales tend to ebb and flow as companies intermittently invest in chips and other data center infrastructure. For instance, revenue growth could slow toward the beginning of fiscal 2027 as the company ramps up production of its next-generation Rubin GPU (slated to launch in the second half of next year).
However, investors should also bear in mind that Nvidia has a substantial opportunity in its often overlooked automotive and robotics segment, which currently accounts for less than 2% of total sales. Generative AI has been in the spotlight since ChatGPT launched in late 2022, but Huang says the "ChatGPT moment" for autonomous cars and robots is right around the corner.
Importantly, Nvidia has three computing platforms that address those markets: data center infrastructure to train models, a simulation engine to test those models, and embedded systems that handle on-board computing. Also, the company provides software tools that help developers build the necessary applications.
Here's the bottom line: Nvidia enjoys a leadership position in a quickly growing market, and shares trade at a reasonable valuation. The stock price may be volatile over relatively short periods (i.e., months) due to the cyclical nature of the industry, but Nvidia still has a long runway for growth as the physical AI (autonomous cars and robots) market takes shape.
