Nvidia (NVDA -2.09%) has been one of the hottest stocks on Wall Street over the past two years and performed well enough that it's vying for the title of the world's largest company against Apple. It currently has a $3.4 trillion market cap, well over halfway to the $5 trillion market-cap figure that's estimated by Wall Street.
Nvidia performed so well in years past that a rise to $5 trillion doesn't seem all that far away, as the stock only needs to grow by 47% to get there. Can Nvidia hit $5 trillion by 2025? It has a lot of work to do.
Nvidia has a few new tailwinds in 2025
Nvidia's rise hasn't been all fluff. Since the start of 2023, its revenue rose by 320%, and its profits skyrocketed by 1,340%. Alongside that incredible business performance came impressive stock returns, which is why the stock price is up 600% since 2023.
Over the long term, stock price movements and profit growth are usually highly correlated, so expecting further upside from Nvidia isn't out of the question, especially when you look at how 2025 is shaping up.
Nvidia's current Hopper architecture is leading all graphics processing unit (GPU) manufacturers. However, its next-generation Blackwell Architecture is ramping up production and primed to be a massive boost for the company. Blackwell architecture offers a four times increase in speed over Hopper when training AI models, so it's not out of the question to think some of the largest AI trainers are waiting to get their hands on this cutting-edge product.
Language from Nvidia's largest clients also predicts that it will see its revenue rise in 2025. Although Nvidia doesn't give specific names, four customers make up around 40% of revenue each quarter. One of these could potentially be Meta Platforms, which informed investors that they should expect increased capital expenditures in 2025 as it builds out its AI computing-power network.
But Meta isn't alone. All of the major cloud computing players, including Microsoft, Amazon, and Alphabet, are seeing major demand for their AI computing power, so they'll also be spending more in 2025 with Nvidia. As a result, Nvidia's business is expected to continue growing well throughout next year.
But is it enough for Nvidia to attain a $5 trillion market cap?
2025 projections make it seem like like $5 trillion is attainable
Looking ahead toward Nvidia's FY 2026 (ending January 2026, which encompasses most of 2025), Wall Street analysts expect 51% revenue and 50% earnings-per-share (EPS) growth. Those are impressive figures and could easily translate to the stock rising an equivalent amount. However, at 45 times forward earnings, the stock isn't cheap.
NVDA PE Ratio (Forward) data by YCharts.
Nvidia's growth is likely to slow throughout the year, so this valuation may become a bit of a premium as the year goes on. However, given Nvidia's growth rates and how strong of a business it has become, it's a reasonable price to pay for the stock if demand persists through 2026.
If Nvidia can deliver these projected results plus indicate that demand in 2026 will be just as strong as demand in 2025, it's entirely reasonable that Nvidia could achieve a $5 trillion market cap by the end of 2025. As a result, the stock looks like a strong buy now.
