This article first appeared on GuruFocus.
Nvidia Corp. (NVDA, Financials), the dominant supplier of artificial intelligence chips, has rallied 6.6% over the past five days as investors position for its Aug. 26 earnings report. Goldman Sachs cautioned that the recent run has raised the bar for results.
Analyst James Schneider said GPU supply and demand remain strong, but elevated expectations could leave the stock vulnerable to a sell-the-news reaction even if Nvidia posts another solid quarter.
The broader spending backdrop remains supportive.
Wall Street expects Alphabet, Amazon, Meta, Microsoft and Oracle to spend about $733 billion in 2026, up sharply from earlier forecasts. JPMorgan estimates Nvidia captures roughly 26% of capital spending by those major cloud operators.
That helps explain why expectations remain so high. Consensus estimates also point to rapid growth through 2028 as hyperscalers continue expanding AI infrastructure.
For investors, the question is no longer whether demand is strong. It is whether Nvidia can deliver results and guidance strong enough to justify a stock that has already rallied into earnings.
