TLDR
- Nvidia shares gained 2.5% Monday to $190.04, building on Friday’s 7.9% jump after major tech spending announcements
- Big tech companies projected to invest over $650 billion in capital expenditure during 2026, primarily for AI infrastructure
- OpenAI’s planned $100 billion fundraising expected to lift Nvidia and other AI chip stocks, per D.A. Davidson
- Despite recent gains, stock remains nearly flat for 2026 due to tech rotation and custom chip concerns
- Earnings scheduled for February 25 with Wall Street forecasting 71% EPS growth to $1.52
Nvidia shares added 2.5% Monday, finishing at $190.04. The move continues momentum from Friday’s 7.9% surge that broke a five-day slide.
The driver is clear: tech companies are opening their wallets for AI. Alphabet and Amazon announced substantial infrastructure investments that caught investor attention.
Combined spending from major U.S. tech firms is forecast to top $650 billion this year. The bulk of those dollars will fund AI infrastructure development.
Nvidia stands to capture a large slice of that spending. The company dominates the AI chip market with its advanced graphics processors.
Analyst Sees Major Upside From Capital Spending
William Blair’s Sebastien Naji highlighted the opportunity. “The massive step-up in capex now expected in 2026 is likely to greatly benefit merchant accelerator providers like Nvidia,” he noted.
The stock hasn’t been smooth sailing though. Nvidia remains barely in the green for 2026 despite Monday’s pop.
Several factors have weighed on shares. A broader rotation out of technology stocks has hit the entire sector.
Worries about whether OpenAI can sustain its current spending pace have created doubt. Competition from custom AI chips developed by tech giants poses another threat.
Rising costs for memory components have squeezed margins. These headwinds have kept a lid on the stock even as AI demand remains strong.
OpenAI Funding Round Could Change the Game
D.A. Davidson analysts see OpenAI’s fundraising as a potential turning point. The company plans to raise as much as $100 billion in new capital.
Gil Luria from D.A. Davidson wrote that investor sentiment could shift sharply. “We expect that as investors go back to seeing OpenAI as a winner, the public companies in its orbit could re-rate considerably,” he explained.
Nvidia isn’t the only beneficiary. AMD stock rose 2.0% Monday while Broadcom climbed 2.3%.
Both chipmakers have supply agreements with OpenAI. The positive sentiment is spreading across the AI semiconductor space.
Strong Earnings Growth Expected
Nvidia’s earnings report drops on February 25. Analysts project $1.52 per share, marking 70.79% growth from the prior-year period.
Revenue estimates stand at $65.56 billion. That represents a 66.68% jump year-over-year.
For the full fiscal year, consensus calls for $4.66 earnings per share. Revenue is expected to hit $212.62 billion.
Those forecasts translate to growth rates of 55.85% and 62.93% respectively. The stock currently trades at a forward P/E of 25.33, below the industry average of 26.96.
Nvidia’s PEG ratio sits at 0.55 compared to the industry’s 2.0. The company carries a Zacks Rank of #2, signaling a Buy recommendation from the firm’s rating system.
