Nvidia's Stock Price Holds Steady as AI Demand Continues to Outpace Supply
Nvidia's stock price has been holding steady near $225 despite the cautious market mood. The company's AI demand continues to outpace supply, and management expects it to remain a bottleneck through fiscal year 2028.
The recent Q2 report showed revenue jumped 106% to $96.2 billion, with Data Center sales rising 117% to $89.0 billion. Management guided Q3 revenue to $108 billion, plus or minus 2%. CFO Colette Kress stated that Nvidia will work to close the supply-demand gap but expects it to remain a bottleneck through fiscal year 2028.
Deals this month reinforced the demand for Nvidia's chips, with Amazon Web Services planning to deploy 2 million additional GPUs across 2027 and 2028. The company also committed another $1.5 billion to power developer SB Energy, lifting its total backing to $3 billion. Going forward, investors will judge the stock on how fast Rubin ships, not whether demand exists.
Under valuation model assumptions, the stock is modeled using a revenue growth rate of 60.5%, operating margins of 63.0%, and an exit P/E multiple of 18.7x. Based on these inputs, the model estimates a target price of $595, implying 164.6% total upside from the current share price of $225.