BofA Sets $275 Price Target for NVDA Stock

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•  17 Nov 2025
 

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You've watched $NVDA dominate the AI chip market for months now, riding wave after wave of earnings beats that seemed almost too good to be true. The question burning in your mind isn't whether the company is winning, it's whether the win is already priced in. Bank of America just weighed in with an answer that might surprise you: not even close.

Ahead of earnings on November 19th, BofA analyst Vivek Arya raised his price target on $NVDA to $275, implying a massive forty-seven percent upside from current levels. His thesis rests on something most investors overlook when they see a stock trading near all-time highs: the company is the only proven supplier of commercial AI chips with full-stack solutions at rack-scale system levels. Translation? While competitors talk about catching up, Nvidia is already shipping three generations deep into the future, from Blackwell through Blackwell Ultra and into next year's Vera Rubin by mid-2026.

The numbers backing this call are staggering. Arya points to approximately five hundred billion dollars in accumulated orders for Blackwell and Rubin chips spanning 2025 through 2026, roughly ten to fifteen percent above consensus estimates. That figure emerged from the company's GTC conference and assumes twenty-five billion dollars per gigawatt of capacity. When you're sitting on a backlog that size, the conversation shifts from whether demand exists to whether supply chains can keep pace.

Here's where the valuation argument gets interesting. $NVDA trades at a forward price-to-earnings multiple of twenty-seven times fiscal 2026 earnings and twenty-one times fiscal 2027. Those aren't bubble multiples, they're practically in line with the broader market despite the company delivering what BofA calls the fastest growth cycle in the world. The PEG ratio for 2027 sits at 0.9 compared to an average of 1.7 among leading tech names. For a company projecting fifty-four percent earnings per share growth in fiscal 2027 and another thirty percent in 2028, that's almost absurdly cheap if the growth materializes.

BofA is backing up the optimism with raised EPS estimates, lifting forecasts by three to fourteen percent across the next three years to $4.56, $7.02, and $9.15 per share respectively. The firm projects three hundred billion dollars in revenue for fiscal 2027 with EPS of $7.02, above the consensus $6.74. Gross margins are expected to hold steady at 74.7 percent in 2026, while free cash flow margins should hit fifty-one percent, more than double the twenty percent average among mega-cap tech peers.

Of course, nothing this good comes without risks, and BofA doesn't sugarcoat them. The company faces the difficult task of meeting elevated earnings expectations amid growing skepticism around AI investment returns. Financing conditions have tightened, some of the big tech spenders are showing hesitation, supply constraints persist, and component costs are climbing. Competition is intensifying too, with OpenAI adding Broadcom and $AMD to its supplier list and Google's TPU chips gaining market traction.

But here's the counterpoint that matters: Nvidia remains the only supplier with proven end-to-end performance at the massive system scale AI applications demand. That advantage isn't theoretical, it's embedded in production systems running today and in the roadmap stretching through late 2026. Three generations of proven execution create a moat that competitors can't bridge overnight, especially when customers need solutions that work now, not promises of future parity.

The seventy-four percent operating margins and fifty-one percent cash conversion aren't just impressive numbers on a slide deck, they're the financial signature of a company with genuine pricing power and operational excellence. When you're the dominant supplier in a market exploding with demand, you don't compete on price, you compete on delivery and performance. That dynamic protects margins even as competition heats up.

So what does this mean for your position? If you've been waiting for a pullback or questioning whether the run is over, BofA's analysis suggests the growth story has more chapters left. The stock isn't cheap on an absolute basis, but relative to the growth trajectory and cash generation, it's trading like a mature tech name rather than the linchpin of the AI infrastructure buildout. The five hundred billion dollar order book isn't speculation, it's visibility into the next two years of revenue that most companies would kill for.

The real question isn't whether $NVDA can hit $275, it's whether the AI infrastructure spending cycle proves as durable as bulls believe. If hyperscalers and enterprises keep pouring capital into GPU clusters to train and deploy AI models, Nvidia's position as the essential supplier makes the math work. If AI investment hits a wall or proves less economically viable than hoped, no multiple looks attractive. That's the bet you're making either way.

Earnings on the nineteenth will offer the next checkpoint. The market will scrutinize guidance, margin trends, and any commentary on customer spending patterns or competitive dynamics. But if you believe AI infrastructure spending has years, not quarters, left to run, a forward multiple of twenty-seven on a company growing earnings north of fifty percent starts to look less like a valuation risk and more like an opportunity the market hasn't fully priced.

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