Could Nvidia stock double in value over the next year?

Nvidia (NVDA 3.54%) shares are enjoying an unprecedented run for a company its size. Shares are up nearly 240% in 2023. While 2024 wasn’t as good, it was still impressive, with Nvidia shares up about 108% so far.

Investors have been a bit spoiled by Nvidia’s performance over the past two years, and the current state of affairs might make some think that Nvidia could double its profits Again next year. Is it possible?

Artificial Intelligence Drives Demand for Nvidia GPUs

Nvidia’s growth is directly related to the growth of artificial intelligence (AI). Its graphics processing units (GPUs) play a key role in training AI models because they can process many calculations in parallel. Nvidia’s products are the clear best choice in this area, so they naturally became the best choice for any company looking to build an AI computing infrastructure. The key is that these companies don’t buy one or two GPUs; they combine thousands of them to create a machine that can quickly process incredible amounts of information.

As a result of this demand, Nvidia’s sales have skyrocketed.

NVDA Revenue Data (TTM) by YCharts

In the second quarter of fiscal 2025 (ending July 28), revenue grew 122% year-over-year to $30 billion. The best quarter came from the data center business, which grew 154% year-over-year to $26.3 billion. Notably, revenue also grew 16% quarter-over-quarter, showing that demand is still growing.

Efficiency won’t go away either. Management expects $32.5 billion in revenue in Q3.

Sure, Nvidia’s business is crushing it, and demand is still growing. But will that be enough to double the stock?

Nvidia already has a lot of success in its stock price

For Nvidia’s stock to double, the company would have to be worth $5.2 trillion. For comparison, the world’s largest company is Applewhich is worth less than $3.4 trillion.

This is a huge task that can be accomplished in just one year and it is unlikely to be accomplished in such a short time.

Why? Because all of Nvidia’s growth is already priced into the stock. If you look at Nvidia’s valuation multiples, you can calculate that Wall Street has already priced in about 33% of earnings growth between now and the end of the fiscal year.

NVDA PE Ratio Data by YCharts

While Nvidia’s earnings per share (EPS) rose 168% in Q2, that number will face tough comparisons as it aligns with some strong quarters in fiscal 2024. Furthermore, a price tag of 50 times prior-year earnings and 37 times forward earnings is quite high.

It’s more common for a company with a strong pedigree like Nvidia to trade at around 30 times future earnings. So not only does Nvidia stock have some way to go before it gets back to that point, but it would also have to double its earnings for the stock to double.

When might this be?

At Nvidia’s current share price, forward EPS projections would need to be $7.08 to be worth 15 times forward earnings. Since we’ve set the base valuation at 30 times forward earnings, that would result in a doubling of the share price.

Finding long-range earnings forecasts isn’t easy, with only one Wall Street analyst providing EPS forecasts for fiscal 2028 (ending January 2028). That analyst is forecasting EPS of $5.45, still a long way from the $7.08 required.

If it maintains this growth trajectory, Nvidia will reach that level around fiscal 2029, or about four and a half years from now. While that’s not a doubling in a year, that performance will still beat the broader market, which tends to double every seven years or so.

Nvidia isn’t looking to double its profits anytime soon, but that doesn’t mean it can’t be a solid investment now.

Keithen Drury has no position in any stocks mentioned. The Motley Fool has positions in and recommends Apple and Nvidia. The Motley Fool has a disclosure policy.