Nvidia Stock in 2026: Skyrocket or Crash? Here’s What the Bulls and Bears Miss

Nvidia’s stock has been a rollercoaster—AI darling one day, overhyped gamble the next. Where’s it headed by August 2026? Let’s cut through the noise.

The Bull Case: AI’s Cash Machine

Nvidia’s GPUs still dominate AI training. If demand keeps outpacing supply, those margins could send shares into orbit. Forget P/E ratios—when has that ever stopped a tech frenzy?

The Bear Trap: Competition Looms

AMD’s MI300X and custom silicon from cloud giants threaten Nvidia’s stranglehold. One missed earnings whisper, and this stock could shed billions faster than a crypto rug pull.

Wildcard: Crypto Mining 2.0

If Bitcoin’s next halving sparks another GPU mining craze, Nvidia gets an unplanned revenue bump. Just don’t tell the CFO they’re still reliant on crypto’s mood swings.

Bottom line: Nvidia’s either the last train to AI riches—or the most crowded trade since mortgage-backed securities. Place your bets.

Image source: Getty Images.

These developments suggest Nvidia has room for more upside

Massive spending by cloud computing giants and governments around the globe has played a central role in driving Nvidia's outstanding revenue and earnings growth in recent quarters. The good part is that Nvidia can continue counting on these avenues for growth.

For instance, the capital expenses of big tech players,,, andare expected to hit $364 billion this year, up from an earlier estimate of $325 billion. All these companies are investing substantially in AI data center infrastructure to bring more AI-focused cloud solutions to customers.

The updated capital spending forecast points toward a 63% increase from last year's outlay. A nice chunk of this spending can be expected to be directed toward chips that power AI infrastructure. McKinsey estimates that 60% of AI infrastructure spending is likely to be directed toward chips and computing hardware.

Nvidia's addressable market, therefore, is likely to expand. Importantly, the company is the leading player in the AI chip market, with an estimated share of more than 90% at the end of last year.

Another factor that's going to give Nvidia stock a nice boost is its access to the Chinese market. The company was frozen out of China in April of this year following export restrictions on the sales of its AI chips to that country. However, Nvidia recently pointed out that it has received assurances it will be able to sell its AI chips to Chinese customers once again.

The company has reportedly placed orders for 300,000 China-specific AI chips with its foundry partner(TSMC). That's in addition to the stockpile of 600,000 to 700,000 existing H20 AI processors that Nvidia is currently sitting on. Nvidia is expected to generate an estimated $15 billion in revenue from sales to Chinese customers in the second half of the year.

It is worth noting that Nvidia incurred a $4.5 billion charge in the first quarter of fiscal 2026 on account of restrictions on shipments to Chinese customers. The company also highlighted that its fiscal Q2 revenue WOULD take an $8 billion hit because of those export restrictions. Meanwhile, the aggressive spending on AI infrastructure by governments across the globe is expected to boost Nvidia's annual revenue by $10 billion to $15 billion.

As such, don't be surprised to see Nvidia's revenue in the current fiscal year (which will end in January 2026) coast past Wall Street's expectations of $201 billion, which would translate into an increase of 54% from last year.

But what about the valuation?

Nvidia stock's recent rally has brought its price-to-sales (P/S) multiple to 29 and the price-to-earnings (P/E) ratio to 56. The company needs to keep growing at a faster pace than the market's expectations to justify its rich valuation.

The potential growth outlined above suggest it is indeed capable of doing so. The company's planned re-entry into the Chinese market, along with the substantial increase in AI-related spending by big tech companies that have been buying Nvidia's data center processors, could easily help it eclipse consensus expectations in the coming year.

The impressive growth Nvidia is expected to deliver is the reason its forward earnings multiples are much lower than the trailing ones.

NVDA PE Ratio (Forward) data by YCharts. PE Ratio = price-to-earnings ratio.

So, growth investors should still consider buying this AI stock, which the most optimistic analyst gives a price target of $250 for the next 12 months. That points toward potential gains of 39% from current levels, and there is a good chance that Nvidia could end up hitting that mark thanks to the healthy spending on AI infrastructure in the coming year.