Since the start of the artificial intelligence (AI) boom, investors have asked one question with each new year: Can Nvidia (NVDA 1.17%), the world's AI chip leader, deliver yet another year of outstanding stock market performance? The company has seen its stock soar over the past three consecutive years, in total advancing more than 1,100%.
The reason for this is clear: Nvidia has established itself as a key player in a market marching toward trillions of dollars in value. Analysts expect the AI market to reach about $2 trillion by early next decade. Nvidia is well-positioned to benefit as it sells the AI chips that the biggest tech companies have been flocking to -- and Nvidia prioritizes innovation in order to maintain its dominance.
Of course, it's impossible to guarantee with 100% certainty what Nvidia stock will do this year. Any unexpected event, either specific to the company or industry, or an economic or geopolitical happening, could alter the picture. But we can make predictions based on the company's growth track record and revenue potential to give ourselves an idea of where Nvidia may be by the end of the year. With this in mind, my prediction is that Nvidia's stock will reach the following level by the end of 2026.
Image source: Getty Images.
The early Nvidia story
Before diving in, though, let's trace Nvidia's path so far. The company isn't new to the scene; Chief executive officer Jensen Huang founded Nvidia more than 30 years ago, and in the company's early days, its biggest business was serving the video games market. But it was clear that Nvidia's graphics processing units (GPUs) could also be game changers in other industries. So, the company developed the parallel computing platform, CUDA, to make that happen. That was one key move.
The second key move was Huang's decision to focus GPU design on serving the AI market. This allowed the company to get in on this space early and construct a leadership position. The strategy worked, catapulting Nvidia onto center stage in the world of AI -- and resulting in enormous gains in earnings. And the company's commitment to innovation, with a pledge to update chips annually, should make it very difficult for rivals to get ahead.
NASDAQ: NVDA
Key Data Points
Now, let's consider Nvidia's stock performance potential for 2026. Nvidia turned heads last year when it became the world's first company to reach (and later surpass) $4 trillion in market value. Still, Nvidia may have room to run.
Nvidia stock today trades for 24x sales, but over the past three years, it's often traded for more than 30x.
NVDA PS Ratio data by YCharts
Revenue expectations
With analysts' average 2026 revenue estimate for Nvidia of $213 billion, the company could reach $6 trillion in market value, and this would leave its P/S ratio at about 28x sales. And this would result in a stock price of $247 by the end of the year. So, mathematically, Nvidia stock could climb more than 30% this year to reach that level, scoring a fourth year of gains for shareholders.
On top of this, Nvidia may have a few catalysts for positive stock performance in the quarters to come. The company is on the way to beating one of its biggest challenges in recent times -- reentering China's AI chip market. The U.S., after strengthening export controls last year and halting chip deliveries to China, in recent weeks gave Nvidia the go-ahead to export its H200 system. (Of course, any delays here could also represent a headwind, slowing Nvidia's momentum.)
And later this year, Nvidia aims to release the Rubin platform, fulfilling its promise to innovate on an annual basis.
Finally, data center players are aggressively building out AI infrastructure, and a key part of this is Nvidia's GPUs.
Each of these three elements may add to Nvidia's revenue in the near future and over time, and as these stories develop, Nvidia stock may climb. That's why my prediction is that Nvidia stock will end the year at around $247.
