Nvidia Trading at 21.7x Earnings Despite Projected 82% Revenue Surge
NVDA•Nvidia shares have risen only 5% so far in 2026, trading at 21.7x forward earnings in line with the S&P 500 despite analysts forecasting 82% revenue growth this year and 41% next driven by AI data center spending expected to reach $1 trillion. Analyst Keithen Drury argues the stock remains undervalued because next year’s growth isn’t priced in, positioning Nvidia for potentially strong returns in H2 2026.
1. 2026 Stock Performance
Nvidia shares have advanced just 5% year-to-date, a noticeable slowdown compared with prior years’ gains. This modest performance reflects investor caution as the company navigates a maturing AI hardware cycle.
2. Forward Earnings Valuation
The stock is trading at 21.7 times estimated forward earnings, matching the broader S&P 500 multiple. This valuation appears conservative given Nvidia’s leadership in AI chip markets and strong growth forecasts.
3. AI Data Center Growth Drivers
Wall Street projects AI data center spending to hit $1 trillion over the next two years, underpinning forecasts of 82% revenue growth in 2026 and 41% in 2027. Nvidia’s GPUs remain the preferred solution for large-scale model training and inference workloads.
4. Analyst Bullish Position
Analyst Keithen Drury contends that next year’s growth is not fully reflected in current share prices, making Nvidia an attractive buy. He expects stronger returns in the second half of 2026 as AI adoption accelerates and earnings estimates rise.
