Nvidia Stock on Track to Hit $400 in Five Years

Nvidia's stock price has been on a steady rise, and it's likely to reach $400 in five years if one assumption holds up. The chipmaker's adjusted earnings per share rose 120% year over year in the fiscal second quarter, while revenue climbed 106%.

The company's newly expanded buyback could retire around 4% of its shares at today's price. Nvidia's net income dropped 55% in fiscal 2023, although revenue was flat that year. The chipmaker's chief financial officer, Colette Kress, said on the earnings call that customers' forecasts point to growth doubling next year.

Assuming Nvidia's earnings hold around their fiscal 2028 level, the stock could reach $400 in five years. This would require a modest growth rate of 5-6% annually after 2028, which is achievable given the company's strong outlook and low price-to-earnings ratio.