Bank of America has raised its earnings per share forecasts for Nvidia (NVDA, Financial) over the next few years. The bank cites Nvidia's commanding 80% to 85% share in a potential $400 billion market. Reaffirming its "buy" rating, Bank of America also increased the price target for Nvidia from $165 to $190, marking a potential 40% increase from current levels.
The bank adjusted Nvidia's earnings per share forecast for 2025 from $2.81 to $2.87, for 2026 from $3.90 to $4.47, and for 2027 from $4.72 to $5.67. Analysts led by Vivek Arya pointed out Nvidia's underestimated free cash flow margins, which exceed 45%-50%, nearly double the average of the top seven tech companies at 23%-25%. In the next two years, Nvidia's cash flow is expected to surpass $200 billion, rivaling that of Apple (AAPL).
Additionally, Bank of America highlighted Nvidia's growing influence through collaborations with companies like Accenture (ACN), ServiceNow (NOW), and Microsoft (MSFT). In response to strong earnings from TSMC (TSM), Nvidia's stock surged nearly 4% during trading, reaching a record high of $140.89. The stock has risen 177% this year.
