- Citibank raised its price target for NVIDIA (NVDA) stock to $220 ahead of Q3 FY26 earnings.
- Nvidia closed recent trading just below $200, despite recent AI sector sell-offs.
- Goldman Sachs maintains the view that the AI sector is not currently in a bubble.
- Citi expects Nvidia to surpass consensus revenue estimates for Q3 FY26 and project strong Q4 guidance.
- Nvidia‘s price-to-earnings ratio of 28x is lower than competitors Broadcom and AMD, at 38x and 37x respectively.
Analysts at Citibank have increased their price forecast for Nvidia (NVDA) stock to $220 from $210 as the company prepares to report Q3 FY26 earnings. The upgrade, made by lead analyst Atif Malik, comes amid greater market volatility in the Artificial Intelligence (AI) sector. Nvidia closed trading just under $200, rising 5% to $199.05 on Monday.
In November, stocks in the AI segment, including Nvidia, AMD, Oracle, and Super Micro Computer, experienced significant sell-offs. Investors are expressing concerns about heavy investments in AI. However, Goldman Sachs counters these fears by stating that the AI sector is not in a bubble. According to Brittany Boals Moeller, region head at Goldman Sachs, “We do not think we’re in a bubble, and we pay very close attention to that.”
Moeller also commented on future reliance on Ai technology by younger generations, suggesting there will be winners and losers in AI investments. She advised that investors should remain diligent, noting, “There will definitely be some places where valuations are overblown, and time will tell where those spaces are. So it’s smart for clients to be diligent about how they’re investing in AI.”
Despite recent market downturns, Citibank continues to recommend Nvidia as a strong buy. Malik anticipates a “beat and raise” performance in the upcoming earnings release. He highlights Nvidia’s current price-to-earnings (P/E) ratio of 28x, which is competitively lower than peers Broadcom (AVGO) and Advanced Micro Devices (AMD) with ratios of 38x and 37x, respectively.
Malik predicts that Nvidia will report Q3 FY26 revenue of approximately $56.8 billion, surpassing the Wall Street consensus estimate near $54.6 billion. Furthermore, he expects the company’s Q4 revenue guidance to reach about $62.6 billion, exceeding the Street’s projection of $61.5 billion.
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