Nvidia Corporation (NASDAQ:NVDA) once again kicked the door off the hinges with its Third Quarter Fiscal 2026 results. The company’s revenues reached a new record of $57 billion – up 62% year-over-year and 22% sequentially – while its GAAP and non-GAAP gross margins were both north of 73%.
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“Off the charts,” “sold out,” and “growing exponentially” were all used by CEO Jensen Huang to describe Nvidia’s performance. “We’ve entered the virtuous cycle of AI,” explained the CEO, referencing how compute demand just keeps accelerating and compounding.
However, another type of cyclical activity is worrying investors, namely the circular financing in which billions of dollars in AI funding are exchanging hands between a handful of players. This has sparked fears among some that we are on the precipice of an AI bubble.
These concerns have no doubt been pressuring NVDA’s share price, which has sunk by 4% following its stellar earnings report last week.
One top investor known by the pseudonym JR Research argues that the market is not fully appreciating Nvidia’s future potential.
“Put aside AI bubble fears right now, as Nvidia’s bull case is far from imploding, allowing long-term buyers to capitalize on the irrational fear-driven sell-off,” explains the 5-star investor, who is among the top 2% of stock pros covered by TipRanks.
While JR acknowledges that these worries have some merit, the investor also points out that Nvidia expects AI infrastructure spending to hit a range between $3 and $4 trillion by 2030. This creates a huge runway of opportunity for Nvidia, adds JR.
Moreover, the investor also cites Huang’s assertions that Nvidia’s portion of the data center ecosystem increases with every successive generation of technology. At the end of the day, JR reminds investors, Nvidia possesses the best performance per watt, making it the most efficient architecture around.
“I believe any calls into Nvidia’s purported demise amidst this mega AI build cadence aren’t just premature, but also not grounded in reality,” adds JR.
At the end of the day, the investor posits that fears of underinvesting and “losing that edge” are greater than the risks of an AI overbuild. In fact, big tech has committed to more than $600 billion in AI capex during CY2026, notes JR, while Nvidia’s backlog for Blackwell and the forthcoming Vera Rubin is $500 billion.
JR also points out that this may even be understated, as the AI spend has shown a tendency to undergo “sharp upgrades” over the past few years.
“I find it incredulous that the market doesn’t seem to have the same level of conviction in Nvidia’s posturings,” emphasizes JR, who rates NVDA a Buy. (To watch JR Research’s track record, click here)
That’s right where Wall Street finds itself as well. With 39 Buys, 1 Hold, and 1 Sell, NVDA enjoys a Strong Buy consensus rating. Its 12-month average price target of $257.33 implies an upside north of 40%. (See NVDA stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.