Jimmy Investor
Former Equity Analyst
Nvidia's record buyback shows a company confident in its future cash flows. Per a quoted post, Nvidia authorized a $150 billion buyback, the largest single increase in US corporate history, while Jensen Huang called the current cycle the largest infrastructure buildout in human history. x.comÂ
NVIDIA's record buyback signals management sees the stock as undervalued and buying it as a good use of cash. It announced a new $150 billion authorization, bringing the total to $235 billion, with its market cap above $5.5 trillion. x.comÂ
Nvidia's $150 billion buyback is immaterial and cannot provide a floor under the stock. Against a $5 trillion market cap it is about 3% over roughly two years, under 2% a year, whereas Apple's $100 billion buyback came when its market cap was about $900 billion. Stock-based compensation and the size of insider sales over the last year offset it further. Nvidia remains a remarkable company. x.com x.comÂ
Nvidia's cash could have more value invested in AI companies with strong demand but too little capital to scale, especially neoclouds that can execute. Their valuations look very attractive now, making equity stakes preferable to more buybacks or dividends despite criticism of circular deals. SpaceX may need the money less because it is already very big. x.com x.com x.comÂ
Nvidia's expanded buyback signals confidence: if no one else buys the stock, Nvidia will. The board added $150 billion of authorization, bringing the remaining total to $235 billion, which Nvidia expects to complete by the end of fiscal 2028, more than 4% of its shares within about a year. The scale of the program reassures the market. x.comÂ
Nvidia's equity-investment book makes earnings vulnerable to an AI valuation downturn even if GPU sales hold up. Private and public stakes totaled about $99bn, or 31% of assets, in July; gains were $15.9bn in April and $7.8bn in July. Private holdings are marked on observable transactions or impairments, so losses could arrive in lumps. Nvidia generated about $127bn of free cash flow over four quarters, and the filing does not split private stakes by sector. x.com x.comÂ
Nvidia's next move is being underestimated while attention is on Meta as the Magnificent Seven all-time-high candidate. Nvidia has increased its record buyback authorization to $235 billion into fiscal 2028, just as the stock breaks out from a year-long range. x.comÂ
Nvidia's rising revenue alongside a much lower P/E is getting hard to ignore. Its chart shows quarterly revenue above $80 billion in Q2 2026 while the P/E is around 30x, down from much higher multiples in prior years. x.comÂ
Nvidia's $14 billion purchase of Hugging Face deepens a conglomerate discount that has been building. The business may be getting more insulated, but it is also getting harder to understand, which could add to the stock's lack of a multiple premium. This is a caution rather than an outright bearish call. x.comÂ
Nvidia's buyback increase to $235 billion, the largest in history, should help lift the share price and add significant downside protection. x.comÂ