Nvidia Jumped Back Above $5 Trillion. When Will It Hit $6 Trillion?
Key Points
Nvidia is rapidly growing.
Even with a valuation below average, Nvidia is likely to hit the $6 trillion mark soon.
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Nvidia (NASDAQ: NVDA) first crossed the $5 trillion valuation threshold in October 2025. It then promptly retreated from those levels, but it's bouncing back. Nvidia reached a $5 trillion valuation again in April, and now the question is when it will hit $6 trillion market capitalization.
Growing from a $5 trillion company to a $6 trillion one is no easy feat, as it requires the stock to rise 20%. Still, I think Nvidia has the growth in store to do it before 2026 is over. Considering 20% is far greater than what the S&P 500 usually returns over a whole year, that would make Nvidia a strong investment pick, and I think it's exactly that.
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Image source: Getty Images.
The math is simple to get to $6 trillion
Doing the math to figure out what growth Nvidia must achieve to hit a $6 trillion valuation isn't that difficult, but first, we must make some assumptions. The biggest is what valuation the stock will trade at. I think 30 times trailing earnings is a fair valuation for Nvidia (actually, I think it should be 35 or so, but this bakes in some conservatism). That places it right around some of its peers, as Alphabet trades for 32 times earnings, Microsoft is at 27, and Apple is at 34.
To reach a $6 trillion valuation at 30 times earnings, that requires $200 billion in net income. So, when will Nvidia hit that?
Wall Street analysts project Nvidia will have revenue of $371 billion at the end of fiscal year 2027 (ending January 2027). Over the past 12 months, Nvidia has delivered a 56% net income margin, so if it can maintain that, it would indicate net income of $208 billion. That's above the $200 billion we're looking for, so I think it's safe to say that Nvidia can easily surpass this threshold by the end of this year as long as estimates and margins hold.
The reality is that Nvidia will likely trade at a premium to 30 times earnings (it's currently trading at 43.5 times earnings and hasn't traded below 32 times earnings since the tariff-induced sell-off in April 2025).
NVDA PE Ratio data by YCharts
I think this solidifies the possibility that Nvidia could become a $6 trillion company before 2026 ends, making Nvidia stock a smart buy now.
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Keithen Drury has positions in Alphabet, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
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