Analysts Push Nvidia to Raise Dividend Yield to 0.5–1% on $400B FCF
Bank of America analysts say Nvidia’s 0.02% dividend yield deters income funds despite forecast $400B free cash flow in 2026–27 and propose raising yield to 0.5–1% at $26–51B cost. Nvidia holds 90% GPU share and trades at 26x 2026 earnings with analysts projecting 39% revenue and EPS growth through 2029.
1. Dividend Hike Proposal
Bank of America analysts argue that Nvidia’s current 0.02% dividend yield is excluding the company from income-oriented portfolios and recommend boosting the payout to between 0.5% and 1% to close a valuation gap with peer tech giants.
2. Free Cash Flow Capacity
Nvidia is projected to generate approximately $400 billion in free cash flow over 2026 and 2027 combined, providing sufficient capacity to fund an expanded dividend program at an estimated cost of $26 to $51 billion.
3. GPU Market Dominance
The company maintains a roughly 90% share of the discrete GPU market, underpinning its leadership in AI infrastructure and reinforcing confidence in its cash-generation ability.
4. Growth Projections and Valuation
Analysts forecast Nvidia will deliver 39% annual revenue and EPS growth through 2029, while the stock trades at about 26x 2026 earnings, implying room for re-rating if income returns increase.