70% Revenue Growth for Nvidia Next Year May Make It the Best Stock to Buy In the Market

When companies speak, investors need to listen to what they say. While the market may have one notion or conception about a stock, when a trustworthy company says something to the contrary, investors should pay attention.

That's what I think is happening with Nvidia (NASDAQ: NVDA) stock right now, as the market isn't very convinced about the company's next year's prospects despite management telling investors that it expects 70% revenue growth.

This mismatch makes Nvidia among the best stocks to buy in the market right now, as the implications of it growing 70% next year make the stock an absolute bargain at today's levels.

Image source: Getty Images.

Nvidia is the perfect buy right now

During Nvidia's second-quarter earnings call, CFO Collette Kress gave guidance that Nvidia's revenue will grow by 70% next fiscal year. This assumes a supply constrained state, which I think is a safe bet thanks to memory chip shortages and AI budgets continuing to rise. Furthermore, Nvidia has pretty much undershot every projection it has provided investors since the AI race began in 2023, so this is likely the floor of where the company expects to grow.

Regardless of whether it's the floor, 70% growth for any company is impressive, let alone Nvidia, which is the world's largest company by market cap, valued at more than $5 billion.

For this fiscal year, Wall Street analysts expect $9.31 in earnings per share. Nvidia's earnings and revenue have grown in lockstep, so it's safe to assume the company's earnings will also rise by about 70%. This projects Nvidia to have EPS of $15.83.Right now, Nvidia trades for 29 times earnings, which is pretty cheap compared to where it has traded over the past three years.

NVDA PE Ratio data by YCharts

Regardless, if Nvidia achieves earnings per share of $15.83 and has a valuation of 29 times earnings, that would price the stock at nearly $460 per share. Currently, Nvidia trades for about $230 per share, so this clearly projects it's a double.

If you can find a stock that's slated to double with a fairly high certainty and in less than two years, then there's really no question as to whether the stock is a buy or not. Nvidia is among the best stocks to invest in right now, and the market hasn't priced in any of 2027's growth yet. That's a rare opportunity for investors, and now is the time to pounce on it.

Keithen Drury has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.