Motley Fool analyst Keithen Drury argues Nvidia's stock is undervalued enough to double within a year, pushing its market cap past $10 trillion. His case rests on Nvidia's own revenue guidance, a widening profit margin, and a price-to-earnings multiple he calls too low next to peers such as Apple.
Nvidia shares trade at $230.36, up 0.84% on the day, giving the chipmaker a market cap of $5.25 trillion. Drury thinks that price undersells the company badly enough for the stock to double within twelve months.
Nvidia's own guidance backs the bull case
For fiscal 2028, ending in January 2028, Nvidia has guided for 70% revenue growth. Wall Street analysts separately expect $411 billion in revenue for fiscal 2027, which ends in January 2027. Drury notes Nvidia has a long track record of exceeding its own guidance through the AI race, so he wouldn't be surprised if it happens again.
Hyperscaler spending underpins demand
Nvidia's grip on GPU computing gives it visibility other investors lack, since customers place chip orders well before their data centers are ready. That pipeline lines up with Nvidia's projection that capital expenditures from the top five AI hyperscalers will reach nearly $800 billion in 2026 and climb to $1.3 trillion in 2027.
The math behind a $10 trillion valuation
Applying that 70% growth rate to the first half of the following fiscal year, starting from the $411 billion estimate, would produce trailing-12-month revenue of $555 billion, Drury calculates. Widening profit margins support his math: Nvidia posted a 64% profit margin over the past 12 months, and holding that rate steady on $555 billion in revenue would generate $355 billion in profit.
Nvidia currently trades at 27.5 times earnings, a multiple Drury calls too low next to slower-growing peers such as Apple, which trades at 37 times earnings. Assigning Nvidia a 30 times earnings multiple against that $355 billion profit projection produces a $10.65 trillion market cap — nearly double its current $5.25 trillion valuation.
Source: The Motley Fool
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