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NVIDIA: what are the shares worth? DCF and three scenarios
EN Il testo dell'articolo è disponibile in inglese; il titolo è tradotto.
EN Analysis: 9 Nov 2026. Q2/H1 FY27 and balance sheet: 26 Jul 2026. Reference close: 6 Nov, 4 pm EST, before the 8 Nov board statement. Forecasts and DCF are author assumptions.
NVIDIA is growing exceptionally fast, but equity value depends on how much of today’s profitability survives the infrastructure boom. Our ten-year DCF produces a base-case value of about USD 148.27 per share, versus the USD 186.64 close on 6 November 2026. Scenario values range widely, from about USD 54 to USD 312. These are conditional author calculations, not company forecasts or investment advice.
1. The starting point: results, not just an AI narrative
Q2 FY27 ended on 26 July 2026. Revenue rose 106% year on year and gross margin reached 75%. Data Center generated USD 89.0 billion, or 92.5% of sales, by our calculation. The main exposure is computing infrastructure, rather than gaming graphics alone.
Management guided Q3 FY27 revenue to USD 108 billion ±2%, with gross margin around 74%. Results are scheduled for 17 November. The quarter has ended, but its guidance is not a reported result. FY27 denotes NVIDIA’s fiscal year, not calendar 2027.
NVIDIA · results and guidance, 26 Aug 2026 NVIDIA · Q3 reporting date
2. Accounting profit is not shareholder cash flow
In H1 FY27 NVIDIA reported USD 118.010 billion of net income, operating cash flow of 74.421 billion and property, equipment and intangible purchases of 4.434 billion. Subtracting the last two gives USD 69.987 billion, but that simplified cash-flow measure is not automatically FCFF. Net income included 23.707 billion of equity-security gains.
Our DCF therefore starts from operating EBIT, not net income. Investment gains do not recur in the operating forecast. CUDA, GPUs and networking form an integrated offering, but valuation still requires durable customer purchases and cash after funding growth.
SEC · income, cash flow and business disclosures
3. What the base case assumes
The valuation date is 9 November 2026, in nominal USD. We forecast ten full annual periods starting on that date: F1 ends on 9 November 2027 and F10 in 2036. We do not count an entire, partly elapsed FY27 again. All forecasts below are author assumptions; no paid analyst consensus is used.
F1 revenue is USD 470 billion, above the 432 billion obtained by multiplying Q3 guidance by four. This deliberately assumes further growth; it is not management’s next-year forecast. Reliable GPU unit and selling-price forecasts are unavailable to us. Segment revenue assumptions are not a substitute for that analysis.
Margins fade below the reported Q2 level as competition, mix and scale evolve. Stock-based compensation remains an EBIT expense, without a cash add-back. Shares are fixed, with no additional mechanical dilution for the same future SBC. Buybacks are not assumed to create free value. Operating leases remain operating expenses, without subtracting lease debt again.
4. The cash-flow forecast: growth requires investment
FCFF = EBIT × (1 − tax) + D&A − capex − change in NWC. The table is in USD billion and rounded; calculations retain full precision.
Starting NWC is USD 56.024 billion: receivables + inventories + prepaids − trade payables − accrued current liabilities from the source balance sheet. F1 NWC reaches 94 billion, consuming 37.976 billion. These broad balance-sheet accounts approximate operating NWC; they are not a detailed schedule of every provision and tax balance. Capex covers ordinary investment. Future acquisitions and equity purchases are not forecast.
Terminal growth is not free: F11 FCFF = F10 NOPAT × 1.03 × (1 − 3% / 20%) = USD 353.478 billion. Reinvestment consumes 15% of after-tax operating profit to support 3% nominal growth. This separately normalizes terminal reinvestment, so F11 is not simply F10 FCFF multiplied by 1.03.
5. From the operating business to per-share value
WACC starts from the 4.86% US ten-year Treasury yield on 6 November. Other inputs are assumptions: beta 1.3, equity risk premium 4.5%, debt cost 5.5%, equity/debt weights 99.3%/0.7%, and tax 18%. The resulting 10.6666% is rounded to 10.7%. Beta is not a measured regression estimate. All cash flows are discounted at full annual period ends.
US Treasury · 6 Nov 2026 yield curve
Material limitation: the bridge uses the 26 July balance sheet without reconstructing cash, investments or buybacks through 9 November. Shares are the Q2 weighted-average diluted count, not the current fully diluted total. Equity assets comprise reported marketable investments of 42.783 billion and non-marketable investments of 51.157 billion. The 25% haircut is an assumed combined buffer for valuation changes, taxes and liquidity, not a disclosed tax rate. Other investment assets are not added separately. Not every guarantee or provision is separately valued. All cash is treated as excess; retaining operating cash would reduce value.
SEC · balance sheet and diluted shares
6. Why the scenarios are so far apart
Full paths for all cases are provided in the model data. The bear case combines slower sales, margin erosion and a higher discount rate. The bull case requires faster adoption and durable exceptional profitability. These are not confidence intervals or probability forecasts. We do not assign arbitrary scenario weights.
7. What would justify the reference share price?
The base case is 20.6% below the USD 186.64 reference close. Terminal value accounts for 47.4% of EV. This table changes only WACC and g, including the associated terminal reinvestment. Values are USD per share.
With all other base assumptions unchanged, USD 186.64 corresponds to WACC of about 9.07%, rather than 10.7%. Alternatively, at 10.7% WACC and unchanged subsequent growth, margins and other revenue, F1 Data Center revenue would need to be about USD 563.9 billion, versus 440 billion. This is a mechanical reverse DCF, not evidence of investors’ actual beliefs.
The reference is the Nasdaq regular close at 4 pm EST on 6 November. It predates the board’s 8 November statement and is not presented as a current post-event quote. NVIDIA’s own quote page carried an older timestamp, so the close was checked in Stock Analysis and independently in FT’s history. Using the 24.1 billion basic shares disclosed for 21 August implies roughly USD 4.50 trillion of market capitalization; this is a proxy, not a current market-cap observation.
NVDA history · Stock Analysis FT · independent close confirmation
8. What would change the valuation?
SEC · business and export risks NVIDIA board · 8 Nov 2026
The next dated test is the 17 November report: revenue, margin, cash conversion and new guidance. Persistently better cash flow would support a higher value; weaker demand, more growth funding or a higher risk premium would reduce it. This is a screen-grade valuation: public facts are sourced, but forecasts, capital-cost inputs and the unrolled balance-sheet bridge remain assumptions. A falling share price alone does not establish a bargain.
Full DCF inputs, calculations and scenarios, JSON
Educational material and author scenario analysis. Not an investment recommendation. Analysis date: 9 November 2026.
Gli articoli riflettono le opinioni personali dell’autore alla data di pubblicazione. Non costituiscono raccomandazioni d’investimento.