Shares of Nvidia (NVDA 1.53%) have been under pressure over the past three months, shedding almost 2% of their value owing to a variety of factors.
From geopolitical tensions related to the shipments of its chips to China to the sustainability of the huge spending on artificial intelligence (AI) data centers to concerns about AI being in a bubble, investors have found multiple reasons to doubt Nvidia's prospects. However, they seem to be overlooking the remarkable growth that Nvidia has been clocking despite its status as the largest company in the world.
As a result, it won't be surprising to see the stock soaring when it releases another round of terrific results on Feb. 25.
Image source: Nvidia.
Nvidia's growth is anticipated to accelerate this year
Nvidia will release its fiscal 2026 fourth-quarter results (for the period ended Jan. 25, 2026) after the market closes on Feb. 25. The company has exceeded consensus earnings estimates in each of the last four quarters, which is impressive considering that it has witnessed headwinds such as restrictions on sales of its chips to Chinese customers.
NASDAQ: NVDA
Key Data Points
Analysts are expecting a 67% increase in Nvidia's revenue for fiscal Q4 to $65.5 billion, almost in line with the company's guidance. Its earnings are expected to jump by 71% from the year-ago period, which seems achievable considering Nvidia's improving product mix and cost-control initiatives. It is worth noting that Nvidia's guidance didn't include any potential sales to Chinese customers.
Looking ahead, analysts forecast Nvidia's earnings growth to accelerate to 63% in fiscal 2027 from 57% last year. The solid growth forecasts for the new fiscal year aren't surprising. Nvidia is on track to launch its next-generation Vera Rubin data center graphics cards this year. These cards are already in full production, as Nvidia pointed out last month.
According to HSBC, Vera Rubin chip systems will carry a premium over the previous-generation Blackwell systems. Given that the Vera Rubin data center chips are expected to reduce AI inference costs by 10 times when compared to Blackwell, it won't be surprising to see sales of these new processors take off.
So, there is a possibility Nvidia will deliver better-than-expected guidance when it releases its results later this month, and that could be enough for the stock to regain its mojo.
Investors may be missing an obvious reason to buy Nvidia stock right now
Nvidia stock's recent weakness and the company's impressive growth have made it a no-brainer buy right now. It can be bought at just 24 times forward earnings, a discount to the tech-focused Nasdaq-100 index's forward earnings multiple of 26 (using the index as a proxy for tech stocks).
What's more, analysts are bullish about the stock's prospects over the next year. Nvidia stock has a 12-month median price target of $250, which would be a 35% jump from current levels. However, this semiconductor stock could clock bigger gains given its strong revenue pipeline and the arrival of its new generation of AI processors, which is why it would be a good idea to buy it before Feb. 25 while it trades at attractive levels.
