Key Takeaways
- Nvidia shares reached an all-time closing high of $238.90, bringing market capitalization to approximately $5.76 trillion.
- A share price of $248.96 would push the company past the $6 trillion valuation threshold at current share levels.
- BNP Paribas analyst elevated his target from $285 to $345, driven by expectations around AI agent proliferation.
- Manufacturing partner Foxconn reported quarterly revenue up 47%, highlighting robust AI server orders.
- The company expanded its share repurchase authorization by $150 billion, marking a record-breaking capital return move.
Shares of Nvidia reached an unprecedented closing price of $238.90 during Monday’s trading session, marking a 2% daily gain. The semiconductor giant’s market capitalization now stands at approximately $5.76 trillion.
This represents the chipmaker’s first record-breaking close in more than six months. The prior peak stood at $235.74, set earlier in May.
Crossing the $6 trillion market cap milestone would require the stock to exceed $248.96 per share. This calculation relies on the current number of outstanding shares, though active buyback activity could alter that figure.
Karl Ackerman, an analyst at BNP Paribas, believes additional upside remains. He upgraded his price objective to $345 from $285 in a recent note.
His thesis revolves around the emergence of AI agents, which he anticipates will create substantial incremental demand for the company’s silicon. Ackerman also forecasts that Nvidia will command over 75% of the AI computing market measured by revenue.
Factors Behind The Bullish Outlook
According to Ackerman, the company’s full-rack AI systems combined with its CUDA software ecosystem create a competitive advantage that rivals struggle to replicate. He projects gross margins will remain north of 70%, despite increasing competitive pressure.
His valuation methodology applies a conservative 15x price-to-earnings ratio to his 2028 earnings projection, then adds the company’s cash position. It’s a modest framework for a stock that continues posting substantial gains.
Barron’s featured Nvidia as a recommended investment in May when shares traded near $226. The publication’s 12-month price target of $300 appears within reach sooner than anticipated.
Monday brought additional positive news from Foxconn, a key Nvidia manufacturing ally. The Taiwanese electronics manufacturer, officially called Hon Hai Precision Industry, disclosed September-quarter sales of 3.03 trillion New Taiwan dollars, equivalent to $95.48 billion.
This figure represents a 47% increase versus the year-ago period. Foxconn indicated its AI-related business would maintain growth momentum through the fourth quarter, though it stopped short of providing numerical guidance.
While Foxconn gained recognition in the United States primarily through its Apple device assembly operationsāApple shares were flat Mondayāits current revenue mix leans heavily toward cloud infrastructure and networking equipment, particularly AI servers powered by Nvidia processors.
Valuation Appears Compressed Relative to Historical Norms
Paradoxically, despite the record share price, Nvidia’s forward earnings multiple sits near its lowest level in more than ten years. This compression seems counterintuitive given Wall Street expects both revenue and profit to roughly double during the current fiscal year.
Monday’s closing price translates to a forward P/E ratio of 17.1x, based on FactSet figures referenced by Barron’s. Even CEO Jensen Huang has highlighted this valuation disconnect.
Speaking at a Goldman Sachs technology conference last month, Huang described Nvidia as “the world’s first and only growth value stock.” He characterized the company as “incredibly misunderstood” by the investment community.
Goldman Sachs shares declined 1% that day. Nvidia made another significant announcement regarding shareholder returns last week.
The board approved a $150 billion expansion of its existing buyback authorization. Combined with the remaining previous authorization, the company now has $235 billion available for share repurchasesāwhat Nvidia describes as the largest single authorization increase on record.
Management plans to execute the entire repurchase program by the end of fiscal 2028. The analyst community currently maintains a consensus price target of $334.45, according to FactSet data.
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