Nvidia’s record adds weight to the AI trade at a time when much of the chip sector has already run far ahead, raising the question of whether the leader is now catching up or the sector is getting stretched. The buyback provides a steady source of demand for the shares, which may help cushion pullbacks. As the largest stock in the major US indices, Nvidia’s moves carry outsized influence over the S&P 500 and Nasdaq, so its strength is helping keep broader equity benchmarks firm despite elevated bond yields. A shift in the AI bottleneck towards power and land would also put utilities and data centre infrastructure more firmly in focus.
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Nvidia is closing in on $6 trillion, yet the strangest part of its record run is that it has spent 2026 chasing the rest of the chip pack.
Summary:
- Nvidia hit fresh record highs around $238 to $240 on Monday after its first record close since May on Friday.
- Its market value is about $5.7 trillion, within roughly $300 billion of $6 trillion, and the stock is up about 28% this year.
- The board approved another $150 billion in buybacks, taking total remaining authorisation to about $235 billion through fiscal 2028.
- Morgan Stanley reinstated Nvidia as its top chip pick, citing AI demand and a shift in bottlenecks towards data centre power.
- The company has guided to current-quarter revenue of about $108 billion.
- A widely tracked semiconductor ETF is up about 96% this year, more than three times Nvidia’s gain.
Nvidia shares pushed to fresh record highs on Monday, extending a rally that has lifted the AI chipmaker’s market value to around $5.7 trillion and within roughly $300 billion of the $6 trillion mark.
The stock traded around $238 to $240, building on Friday, when a gain of almost 3% delivered its first record close since May. Nvidia is now up about 28% so far this year and has recovered strongly from a July sell-off that wiped around $1 trillion off its market value.
Two developments drove the latest leg higher. Nvidia’s board approved an additional $150 billion in share buybacks, lifting its total remaining authorisation to about $235 billion through fiscal 2028, which has been described as the largest repurchase programme in corporate history. Morgan Stanley also reinstated Nvidia as its top semiconductor pick after meetings with chief executive Jensen Huang, citing sustained AI demand, a broadening customer base and a valuation it considers relatively undemanding. The bank argued that the main constraint on AI infrastructure is shifting from chip supply towards power and land for data centres, which could favour Nvidia as customers seek more computing output from limited electricity.
The fundamentals remain strong. Revenue in Nvidia’s latest reported quarter roughly doubled from a year earlier, and the company has guided to revenue of about $108 billion for the current quarter. Supply chain signals are also firm, with Taiwan’s Foxconn reporting record September revenue on AI server demand.
Yet the record masks a less obvious point: Nvidia has been a laggard within its own sector this year. A widely tracked semiconductor exchange-traded fund has gained about 96% in 2026, more than three times Nvidia’s advance. On that measure, the market leader has been catching up with the rest of the sector rather than leading it.
Analysts remain divided on what comes next. Some argue Nvidia’s earnings growth can keep pushing the shares higher even if its valuation multiple continues to compress. Others warn that the AI spending cycle has not yet reached the stage where overinvestment and overcapacity become a risk for chip suppliers, but that it eventually could.
You may recall back in March I wrote about how you need to be careful about incorrect application of the “Magaizne Cover Index”. I used this cover as an example and why it didn’t fit the “top” argument. And here we are.
This article was written by Eamonn Sheridan at investinglive.com.