Should You Buy Nvidia (NVDA) Stock Ahead of Next Week’s Earnings Report?

Key Takeaways

• Nvidia’s Q2 earnings release is scheduled for August 26, with projected revenue near $91 billion
• Analysts from Stifel maintain a $282 price objective while Oppenheimer holds at $265, both anticipating a positive surprise
• The stock currently trades at approximately 24.5x forward earnings, representing a 43% discount to its five-year historical average
• Market watchers consider Q3 forward guidance the critical metric, with projections calling for $103.5 billion in sales
• The Street maintains a Strong Buy rating overall, with mean price targets pointing to $305.86, suggesting 41% potential gains

Shares of Nvidia climbed 0.4% during Wednesday’s premarket session to reach $218.46, positioning the chip giant favorably just ahead of its quarterly report. While the stock has advanced 17% since January, it continues to lag behind the PHLX Semiconductor Index’s impressive 66% rally during the same timeframe.

NVIDIA Corporation, NVDA

The company’s financial results are slated for release on August 26. Leading investment firms on Wall Street have already positioned themselves for an earnings beat.

Ruben Roy from Stifel maintained his $282 price objective this week, forecasting that Nvidia will surpass Street expectations calling for $2.09 in adjusted earnings per share alongside $91.96 billion in quarterly revenue. His valuation applies a 22x multiple to his fiscal 2028 profit projections.

“The earnings cycle has repeatedly validated demand trends as cloud service provider capital expenditures received substantial increases,” Roy noted in his research.

Rick Schafer at Oppenheimer maintained his $265 valuation, highlighting that Nvidia’s current trading level represents only 16 times his 2027 per-share earnings forecast. This stands in stark contrast to AI chip competitors, which average multiples exceeding 30 times.

“With industry-leading profit margins and AI-powered structural expansion, Nvidia stands as the clear infrastructure leader in artificial intelligence,” Schafer stated.

Even with exceptional growth metrics, the stock’s 2026 performance has been relatively muted. Companies including Dell and Micron have delivered percentage gains well into triple digits this year, whereas Nvidia has essentially moved in tandem with major indices.

The Valuation Case

With a $5.45 trillion market capitalization, Nvidia’s shares trade at roughly 24.5x projected non-GAAP earnings. This multiple aligns with sector norms and sits approximately 43% beneath the company’s five-year valuation average.

Some of the market’s caution stems from a recurring concern: that tech giants including Microsoft, Amazon, Alphabet, and Meta might eventually reduce their data center infrastructure investments. However, no evidence of such pullbacks has emerged. These hyperscale cloud providers have signaled expectations for capital spending to expand further in 2027.

The company’s Q1 performance delivered 85% revenue expansion and 140% adjusted earnings per share growth. Yet the stock price barely reacted. This scenario has played out across four consecutive quarters. Exceptional growth has become so thoroughly anticipated that only significant upside surprises generate meaningful price movement.

Management provided Q2 revenue guidance of $91 billion, with a 2% variance buffer, specifically excluding China-related data center compute sales. Non-GAAP gross margin projections hover near 75%, essentially unchanged from the previous quarter.

Forward Guidance Holds the Key

With consensus already anticipating approximately $92 billion in Q2 sales, a marginal beat would simply validate existing expectations. Wall Street professionals emphasize that Q3 guidance represents the true catalyst.

Current consensus estimates place Q3 revenue at $103.5 billion, representing year-over-year growth of roughly 81%. Any outperformance relative to this forecast, or better-than-anticipated gross margin performance, could drive earnings models higher across the analyst community.

Technical indicators also paint a constructive picture. Nvidia’s key moving averages maintain a bullish configuration, with the 50-day simple moving average positioned at $207, approximately 5% beneath current trading levels.

Among 33 analyst ratings published over the last three months, 32 recommend Buy while one maintains Hold. The consensus price target registers at $305.86.