Analysts Expect Nvidia Stock to Soar 47%, But You Shouldn’t Rush to Buy NVDA Here

Nvidia (NVDA) released its fiscal Q2 2027 earnings last week. The company's quarterly performance was stellar and helped it end the long streak of stock declines despite "beat and raise" quarters. Meanwhile, the stock fell 4.57% on Friday and now trades only slightly above its pre-earnings levels. Nvidia hit its record highs in May, and the stock has since failed to breach that level. Nvidia's Q2 Earnings Nvidia's Q2 revenues rose 106% year-over-year (YOY) to $96.2 billion, which easily surpassed Street estimates and was over $5 billion higher than the company's baseline guidance. The Data Center segment, which sells the highly sought artificial intelligence (AI) chips, accounted for $89 billion. More News from Barchart Notably, beginning this fiscal year, Nvidia started reporting its data center segment into two sub-markets: Hyperscale and AI Clouds, Industrial, and Enterprise (ACIE). The move came amid growing concerns about its revenues being concentrated with hyperscalers. However, its Q2 earnings show that while hyperscalers remain a key driver and contributed $49 billion in revenues, the base is getting broad-based, with ACIE revenues rising to $40 billion. Importantly, ACIE's growth outstripped hyperscalers, which is an encouraging sign. For the current quarter, the company expects revenues to rise to $108 billion, with a divergence of 2% on either side, which was ahead of the $104.2 billion that analysts were expecting. The show-stopper was Nvidia's forecast of 70% revenue growth in the next fiscal year, far exceeding the 44% growth analysts were modeling. It was the first time Nvidia guided for the next fiscal year, especially so well in advance. The cherry on top was management stressing that if not for supply constraints, its revenues would double next year. Incidentally, fellow Magnificent 7 peers use the boilerplate disclaimers like "uncertainty" and "potential changes in tariffs and other geopolitical conditions" impacting the guidance even when guiding for the current quarter. In fact, Tesla (TSLA) has stopped providing the annual delivery guidance altogether. Here we have a Mag 7 constituent guiding for the next fiscal year, which signals its confidence in revenue visibility. Going by the backlog and supply constraints, we can be reasonably sure that Nvidia will continue to grow at a fast pace until at least 2028.