The Iran-Israel War has been keeping markets on edge, with tensions in the Middle East escalating fast. U.S.-Israeli strikes on Iran and Tehran’s pushback raised fears of a wider war, especially after President Trump floated the idea of targeting Iran’s energy infrastructure. That kind of uncertainty sent oil prices higher and made investors nervous. Tech and artificial intelligence (AI) stocks, which usually thrive on stability and long-term growth, took a hit, with high-growth names slipping as rising energy costs and global risks clouded the outlook.
But now, things might be turning. Trump says talks with Iran are underway, hinting at a possible deal, and that’s starting to calm markets. A potential U.S.-Iran deal could seriously reshape where investors put their money, and Wolfe Research thinks it could be a big win for AI names like NVIDIA Corporation (NVDA). Analyst Chris Senyek noted that when Donald Trump softened his stance on striking Iran’s energy infrastructure, oil prices dropped and stocks moved higher, hinting at the sensitivity of markets to easing tensions.
If progress continues, the analyst expects investors to lean back into risk, especially AI-driven names. NVIDIA, sitting at the core of the AI trade with its data centers and chip dominance, could see strong inflows as confidence returns. Chris Senyek also sees global capital rotating back into U.S. mega-cap tech names, where growth remains solid, and valuations are becoming more attractive, putting NVIDIA in a great spot and making the AI chip stock a top buy for investors.
Founded in 1993 and based in Santa Clara, California, NVIDIA has become a pioneer in GPUs and AI-driven computing. From gaming to data centers and automotive tech, its innovations have reshaped industries, powering the AI revolution. Beyond technology, Nvidia champions energy-efficient designs and diversity initiatives, combining cutting-edge innovation with responsibility, cementing its role as a cornerstone of modern high-performance computing.
Valued at a market capitalization of $4.26 trillion, shares of the AI chip giant have had their fair share of ups and downs over the past year. Over the past 52 weeks, the stock hit new highs 39 times, surging in bursts before pausing, almost like the market was catching its breath. After peaking at $212.19 in late October, it pulled back 15.6%. Zooming out, though, the picture is still strong, with NVDA up 48.8% over the year.
However, in 2026, NVDA is down nearly 3.7%.
This year has brought some jitters around AI. Tech giants are pouring money into AI at an unprecedented scale, which is great for NVIDIA’s growth, but questions linger about sustainability. Rising in-house AI chip programs also worry investors, as alternatives could chip away at the chip giant’s dominance. Yet recent optimism sparked by Trump’s de-escalation news has helped NVDA rebound, showing that geopolitical easing can quickly reignite confidence in the AI powerhouse.
Looking at the chart, NVDA has been trading above the lower Bollinger Band, suggesting it is holding key support, while still below the upper band, leaving room for upside. The price has fluctuated within this range, reflecting measured volatility, and right now, it feels like the stock is consolidating, patiently waiting for the next big push.
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Valuation-wise, NVDA may seem expensive at first, priced at around 22.93 times forward adjusted earnings and 11.52 times forward sales – but it’s no ordinary chip stock. Sitting at the center of the AI boom, its growth and margins outpace peers, making the premium feel like leadership rather than excess. Plus, the stock trades below its historical averages.
Adding over a decade of steady dividends, NVDA shows it’s both a high-growth story and a cash-generating powerhouse.
NVIDIA’s fiscal fourth-quarter 2026 report, released on Feb. 25, painted a picture of a company firing on all cylinders. Revenue jumped 73.2% year-over-year (YOY) to $68.1 billion, while adjusted EPS surged 82% annually to $1.62 – numbers that beat Wall Street’s expectations, signaling NVIDIA continues to dominate the AI chip space.
The star of the show was its data center business. As tech giants and enterprises race to build AI infrastructure, NVIDIA’s chips are in high demand. Data center revenue alone climbed roughly 75% YOY to $62.3 billion, proving its dominance in powering the AI boom. Even gaming, once the heart of the company, kept pace, rising 47% to $3.7 billion as new architectures hit the market.
NVIDIA’s balance sheet looks rock solid. It ended the year with $62.6 billion in cash, cash equivalents, and marketable securities, paired with relatively low debt, giving it both flexibility and confidence. It generated $34.9 billion in free cash flow in just one quarter, pushing the full-year total to nearly $96.6 billion
That financial firepower is not just sitting on the balance sheet but flowing straight back to shareholders. In fiscal 2026, NVIDIA rewarded investors with $41.1 billion in buybacks and dividends, and it still has $58.5 billion in repurchase authorization.
At its annual GTC conference, NVIDIA painted a bold vision for the next few years. The company projected that its Blackwell and Rubin AI products could generate a staggering $1 trillion in cumulative revenue between 2025 and 2027. Plus, it unveiled low-latency processors from its recent Groq licensing deal and introduced NemoClaw, designed to power OpenClaw’s “agentic” AI, pushing the boundaries of intelligent systems capabilities.
The management projects revenue around $78 billion in the fiscal first-quarter 2027, suggesting this AI-driven growth story is far from over.
Meanwhile, analysts estimate Q1 fiscal year 2027 EPS to increase 118.2% YOY to $1.68. For fiscal year 2027, the bottom line is expected to surge 67.6% annually to $7.66 per share, before rising by another 30.9% YOY increase in fiscal 2028 to $10.03 per share.
Analysts are optimistic about NVDA’s growth potential, overall, giving the AI chip stock a consensus rating of “Strong Buy.” Of the 49 analysts covering the stock, 44 advise a “Strong Buy,” while three suggest “Moderate Buy,” one advises a “Hold,” and only one suggests a “Strong Sell.”
The average analyst price target for NVDA is $269.48, indicating potential upside of 50.44%. Melius Research analyst Ben Reitzes’ Street-high target price of $380 suggests that the stock could rally as much as 112.14% from here.
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NVIDIA has grown into a powerhouse thanks to relentless demand for its AI processors. Companies can’t get enough of its chips, which lets the company charge premium prices and generate massive profits, and that appetite shows no sign of slowing any time soon. With tensions in the Middle East easing, markets are starting to settle, giving growth-oriented stocks like NVIDIA room to shine, as Wolfe Research’s analyst Chris predicts. NVIDIA’s combination of strong fundamentals, innovation, and market momentum could draw investors back in, making NVDA stock a buy now.
On the date of publication, Sristi Suman Jayaswal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
