The Bull Case on Why Nvidia’s Recent Results Are a Strong Buy Signal

• StockStory Top Pick NVDA -0.42%

I think we're going to be entering a very interesting period of time for a whole host of high-growth stocks in the market.

Quick Read

• Nvidia (NVDA) reported quarterly revenue exceeding $35B with 94% year-over-year growth and EPS more than doubled to $0.78.

• Nvidia expects Q4 revenue around $37.5B driven by strong demand for its new Blackwell GPUs.

• The company trades cheaper relative to its growth rate as investors price in eventual business maturation.

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Nvidia (NASDAQ:NVDA) continues to be among the most sought-after investments in the market, and for good reason. The company's high-performance GPUs are the chips that are powering the AI revolution, to a large extent. And while some less-powerful chips are starting to make headlines as a potentially cost-efficient alternative, those companies out there looking to tackle the most data intensive tasks will continue to gravitate toward Nvidia's chips, which are best in class.

Despite concerns that AI spending may be nearing a tipping point where it will have to fall off, and other macro concerns around recessionary pressures building (I've been increasingly bearish of late, as well), it's also true that Nvidia does remain a long-term hold for many who have held this stock through thick and thin.

So, putting my overarching bearish perspective aside for a minute, let's dive into the bull case behind why Nvidia could have more room to run in 2026 and beyond.

Incredible Recent Results

Nvidia visual

Nvidia's outlook has completely shifted from being a story stock with plenty of potential down the road, to a stock that's almost entirely fundamentals driven of late. Of course, most investor will note Nvidia's downside move following its recent earnings report, which shocked many in the market considering how positive the company's numbers have been.

Indeed, Nvidia's overall share price appreciation in recent years has slowed relative to its revenue and earnings growth rates. In other words, Nvidia has actually gotten cheaper relative to its current growth rate in recent quarters, as investors price in an eventual maturation of the company's business and some sort of leveling out over time.

That said, Nvidia's recent blowout earnings report, which beat on nearly every metric and blew most analysts' expectations out of the water, are clearly the story here. Nvidia reported quarterly revenue of more than $35 billion (94% higher on a year-over-year basis), with EPS more than doubling to $0.78 this past quarter from $0.37 in the same quarter the year prior.

Staggering demand for Nvidia's GPUs, largely used in AI, large language models, and by a host of other companies in the cloud computing sector as well, continue to drive these results. However, other key segments from gaming to automotive also saw very strong growth, signaling Nvidia is a vertically integrated story spanning many sectors and industries that's worth considering over the long-term.

Forward Guidance Also Pointing In a Positive Direction

Nvidia logo on a smartphone with a stock chart in the background

The other half of the "beat and raise" narrative involves forward guidance provided by Nvidia's management team. CEO Jensen Huang and others on the call cited continued incredible demand for its GPUs as a key driver of yet another guidance raise, with Nvidia now expecting Q4 revenue to come in around $37.5 billion, which would translate into very meaningful quarter-over-quarter growth and an acceleration of growth on a year-over-year basis.

With a greater percentage of Nvidia's overall sales expected to come from its new Blackwell GPUs, and as AI compute needs accelerate, the company hopes to continue to dominate the market share of all high-end computing companies, and see continued growth from software services revenue as well as adoption continues to pick up.

Where Will Nvidia Go From Here?

Question mark on a white dinner plate

In my view, I think the balance of probabilities favors a new all-time high for NVDA stock in 2026.  While investors may be growing more cautious about valuations and future growth prospects, considering consumer weakness and a breakdown in overall sentiment of late, spending from mega-cap giants does not appear poised to grind to a halt just yet.

Nvidia remains a cornerstone of the whole AI infrastructure narrative, but is also now a cornerstone of most major indices. As such, capital flows into the market as a whole could disproportionately prop up Nvidia stock, providing an even greater incentive for investors looking at reasons to invest in this high-growth mega-cap tech stock to retain (or add) exposure over the course of the next year.

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