Nvidia trades at about 39.9x fiscal 2026 earnings, yet its high-margin growth, an AI-driven roadmap, and meaningful buybacks argue for greater value relative to the broad market, which sits near 30x earnings.

Despite trading near its all-time high, the stock is argued to be undervalued due to its durable profitability, AI leadership, and shareholder-friendly capital return.

Caution on investment recommendation: The Motley Fool Stock Advisor did not include Nvidia among its top 10 stocks, with standard disclosure of positions.

Total buybacks bolster earnings per share growth and reflect confidence in the company’s long-term value, despite its large $4.3 trillion market cap.

In fiscal 2026 Nvidia achieved gross margins of 71%, operating margins of 60.6%, and net margins of 55.6%, translating to $120.1 billion in net income.

The focus on agentic AI and physical AI is positioned as the next phase after generative AI to sustain margins and growth.

Nvidia returned substantial capital to shareholders through buybacks, repurchasing $40.1 billion in fiscal 2026 after $33.7 billion in 2025 and $9.5 billion in 2024.

Intro: Nvidia has delivered massive stock gains, but its upside is framed by high margins, AI leadership, and a robust buyback strategy.

Nvidia’s innovation and AI roadmap emphasize sustained pricing power, with Blackwell Ultra delivering up to 50x performance and 35x lower costs for agentic AI versus Hopper.

Rubin platform enables extreme codesign across six chips for integrated hardware-software solutions, supporting an edge in data-center efficiency and AI workloads.

Nvidia posted fiscal 2026 revenue of $215.9 billion, powered by data center sales that surged to $193.7 billion, up from $15 billion in 2023.

The boom in data-center demand underpins the company’s high-margin growth and pricing power.