Prediction: Nvidia Stock Is Going to Soar After Nov. 19

Nvidia (NASDAQ: NVDA) became the world's first $4 trillion company earlier this year on the back of explosive demand for its data center chips, which have become the benchmark for artificial intelligence (AI) development. On Nov. 19, Nvidia will release its operating results for its fiscal 2026 third quarter, which ends on Oct. 31.

The report will provide investors with an update on the company's financial performance, and the accompanying conference call will feature some valuable commentary from CEO Jensen Huang. Here's why I predict the report will send Nvidia stock soaring.

Nvidia's latest AI chips are in high demand

So far, each new generation of AI models has required more computing capacity than the last. The large language models (LLMs) that powered the original versions of OpenAI's ChatGPT were great at generating fast responses but weren't always accurate. According to Jensen Huang, the latest AI reasoning models consume between 100 times and 1,000 times more tokens (words and symbols) because they spend time "thinking" in the background to produce the best output.

Every top AI company is now working on AI reasoning models, including OpenAI, Anthropic, and Meta Platforms, and it's sending demand for computing capacity through the roof. Nvidia's latest Blackwell Ultra GB300 graphics processing units (GPUs) are designed for these very workloads and deliver up to 50 times more performance than the company's old H100 chips, which launched in 2022.

Next year, Nvidia will release an entirely new GPU architecture called Rubin, which is rumored to be 3.3 times more powerful than Blackwell Ultra -- or around 165 times more powerful than Hopper (the architecture of the H100). Since Nov. 19 marks the final quarterly conference call with investors for calendar year 2025, Huang might offer an update on Rubin's rollout.

These new GPUs will help Nvidia capture a dominant share of what Huang believes will be $4 trillion worth of spending from data center operators between now and 2030 as they upgrade their infrastructure to meet demand from AI developers.

Nvidia's upcoming report could be another blockbuster

Nvidia's guidance suggests its third-quarter revenue will come in at around $54 billion, representing a 54% increase from the year-ago period. Based on previous quarters, the data center segment -- which is where the company accounts for its AI GPU sales -- will be responsible for almost 90% of that revenue.

According to Wall Street's consensus estimate (provided by Yahoo! Finance), Nvidia could also deliver earnings of $1.24 per share, representing 53% year-over-year growth. If this figure meets or exceeds analyst expectations, it could have very positive implications for Nvidia's stock price (but more on that later).

Another thing investors should watch on Nov. 19 is Nvidia's forward guidance because it can be a good indicator of future demand for the company's chips. Wall Street is looking for a revenue forecast of $61.1 billion for the fourth quarter (which ends around Jan. 31, 2026), so if management presents a higher number, it could be another bullish catalyst for Nvidia stock.

Why Nvidia stock could soar after Nov. 19

Nvidia stock might actually be cheap right now, despite the fact it's trading near a record high. Based on the company's trailing-12-month earnings of $3.56 per share, Nvidia stock is trading at a price-to-earnings ratio (P/E) of 51.9.

Although that's a hefty premium to the Nasdaq-100 technology index, which trades at a P/E ratio of 33.5, it's actually a 15% discount to Nvidia's average P/E ratio of 60.9 over the past 10 years. If the company's third-quarter earnings meet or exceed Wall Street's estimate on Nov. 19, its P/E ratio might look even cheaper relative to its 10-year average, paving the way for upside in the stock.

Looking a little further into the future, Wall Street expects Nvidia to deliver earnings of $4.50 per share for the entirety of fiscal 2026, followed by $6.38 per share in fiscal 2027 (which begins in February). Based on those estimates, Nvidia stock trades at forward P/E ratios of 40.5 and 28.6, respectively:

NVDA PE Ratio data by YCharts.

In other words, assuming Wall Street's estimates prove to be accurate, Nvidia stock would have to soar by 113% over the next 12 to 18 months just for its P/E ratio to trade in line with its 10-year average of 60.9.

The upcoming report on Nov. 19 represents one step on that journey. However, the market is a forward-looking machine, so I think investors will keep pricing in Nvidia's future potential, as long as its financial results continue to meet or exceed expectations.

Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms and Nvidia. The Motley Fool has a disclosure policy.