By Dr. James Fox
Publication Date: 2026-01-10 07:08:00
Image source: Getty Images
The Nvidia (NASDAQ:NVDA) share price has almost plateaued over the past six months. There hasn’t been a huge amount of share price growth.
Despite that, the company has continued to deliver very strong earnings growth and very strong forecasts. The innovation cycle is like nothing we’ve seen in recent history. There’s a lot to be excited about.
So, what could happen in 2026?
Nvidia valuation
Valuation is always the starting point for an investment. It should never be “oh, I think this company will benefit from X trend“. Because that trend could already be priced in. The market tries to predict what’s going to happen next, and the likelihood is, someone has already had that idea.
For me, the Nvidia question is whether the market is temporarily undervaluing the stock. And I think it is.
Many people will say, Nvidia looks a little expensive at 39.9 times forward earnings. But remember, Nvidia’s FY2026 comes to an end this month.
-To get a better picture of the forward projections, we need to look at the rolling 12-month forecast or the FY2027 forecast. The rolling 12month forecast tells us it’s trading at 24.8 times earnings, and the FY2027 forecast is 24.3 times earnings.
That’s not a figure I perceive to be particularly expensive when we consider that Nvidia is so critical to the AI revolution. Its chips are integral to most data centres and will be essential for powering the vast…
