Nvidia's October Surprise: Why NVDA Could Soar

Nvidia (NVDA) has had a solid but unspectacular 2026, with shares up about 21% year-to-date. While that beats the broader market, it's a far cry from the explosive gains investors have grown accustomed to. The stock's muted performance comes despite the company's own bullish projections.

During its Q2 earnings call, Nvidia stunned analysts by forecasting 70% revenue growth for fiscal 2028, which ends in January 2028. That's an extraordinary growth rate for a company already valued at $5 trillion. The forecast is driven by expected massive spending from AI hyperscalers—the big five cloud providers—who are projected to increase data center capital expenditures from nearly $800 billion this year to $1.3 trillion in 2027.

Despite these rosy projections, the market has largely shrugged them off. Nvidia's stock trades at just 28 times trailing earnings, a valuation that doesn't seem to reflect the company's growth potential. The disconnect has left some investors scratching their heads.

Now, with Q3 earnings season approaching, the author believes October could be the month that flips the narrative. Many hyperscalers report in the second half of October, and they may start revealing their 2027 capex guidance. If they confirm Nvidia's projections, the market could be forced to re-rate the stock higher.

The core of the bull case for Nvidia is that the market is not pricing in the company's expected growth. At 28 times trailing earnings, NVDA looks reasonably priced for a mega-cap tech company. But when you factor in the projected 70% revenue growth for fiscal 2028, the stock becomes incredibly cheap. Based on fiscal 2028 earnings estimates, Nvidia trades at just 14 times earnings—a valuation typically reserved for slow-growing companies.

If Nvidia meets analysts' expectations and the stock re-rates to a more typical 30 times earnings, shares could more than double by the end of fiscal 2028. That's a massive upside potential that the market is currently ignoring.

The October catalyst is key. Hyperscalers are expected to provide their 2027 capital expenditure guidance during their Q3 earnings calls. Since these companies have already set their expansion plans and provided demand forecasts to Nvidia, their guidance should confirm Nvidia's own projections. When that happens, the market may finally wake up to Nvidia's growth story.

For investors, this creates a potential opportunity. If you believe Nvidia's projections are accurate—and there's good reason to, given the visibility into hyperscaler spending—then buying before the October earnings rush could be savvy. The risk, of course, is that hyperscalers don't confirm the spending plans, or that the market continues to ignore the growth story. But with the stock trading at such a discount to its growth potential, the risk-reward skews favorably for long-term investors.