NVIDIA Corporation (NASDAQ: NVDA) is undeniably the greatest growth story of a generation. Or actually the greatest growth story of a lifetime. After all, it just became the most valuable company in the world. NVIDIA’s market capitalization hit $3.34 trillion based on its $135.58 closing price on Tuesday. Now one analyst on Wall Street is calling for NVIDIA’s stock to become the first company ever to have nearly a $5 trillion market cap.
Rosenblatt Securities already had a Buy rating and previously had an above-consensus $140 price target. The firm has now raised its official target price up to $200. That is a street-high target by quite a wide margin. The analyst valuation upgrade implies a valuation that is 47% higher. That would take its market cap based on the current share count up to $4.927 trillion, so close to $5 trillion it might as well be there.
The analyst upgrade is calling for Nvidia’s Hopper, Blackwell, and Rubin series to keep driving value market share in what feels like a never-ending AI upgrade cycle. Rosenblatt sees NVIDIA’s software significantly boosting the overall sales mix over the next decade and the firm noted that this will positively impact the overall valuation due to sustainability. NVIDIA is also now projected in this call to earn at least $5.00 (per share) by 2026. Giving a 40-times multiple is that driver.
NVIDIA’s rally has every single hallmark of being very long in the tooth and reminiscent of the Dot Com Bubble. That’s still no call to dump all your NVIDIA shares at all, nor is it a call to short sell NVIDIA shares. Why sell a stock when it just keeps going up every day, and so what if you don’t catch the exact top?
ALSO READ: 10 More Stocks After NVIDIA That Need To Split Now!
NVIDIA is now worth more than the Microsoft Corp. (NASDAQ: MSFT) market cap of $3.33 trillion. It’s also now worth more than the $3.28 trillion market cap of Apple Inc. (NASDAQ: AAPL). Where these valuations may start looking out of whack, at least on the surface, is considering the total revenues each company generates. Here are the comparable numbers:
- NVIDIA had fiscal 2024 sales of about $61 billion, and those revenues are expected to rise to about $120.5 billion this year and about $160 billion the following year.
- Microsoft is already above $200 billion in sales and it is expected to hit $280 billion in sales next year.
- Apple already hit $383 billion last year and despite a recent sales dip is expected to hit $413 billion in sales next year.
If you want to know what the old $2,000 NVIDIA price target would imply (now $200 post-split after its 10-for-1 split) this shows a whole rundown for what that would like.
And to be sure not to let you off your feet, NVIDIA shares were worth more than 3% higher at $140.00 on Thursday’s pre-market session. That’s another magical $100 billion in market capitalization created in value from the prior trading session. The chart below is courtesy of StockCharts.com.
