RBC Capital has confirmed its Outperform rating on Nvidia Corp. (NASDAQ:NVDA), keeping a $240.00 price target in place. The firm expects Nvidia to post a quarter that outperforms consensus by roughly 3% to 4% and to follow that with an upward revision, and it anticipates management will either reaffirm or raise the company backlog figure that has previously been described as exceeding $500 billion for 2025 and 2026.
On margins, RBC said it remains comfortable with its gross margin assumptions even in the face of rising memory prices. The brokerage added that it believes Nvidia has already secured HBM pricing for 2026, reducing near-term uncertainty around that input cost component.
RBC identified several potential positive triggers that could bolster the shares. Those include launches of frontier models trained on the Blackwell architecture and events at the GTC conference. Conversations with supply-chain contacts also led the firm to flag particularly strong growth expectations for the Rubin family of products, a trend that RBC believes could help sustain momentum into 2027.
The firm also noted that its financial model does not include China sales of H200 chips, a point intended to clarify modeling assumptions rather than to speculate on upside. On valuation, RBC observed that Nvidia trades at a double-digit discount to both peers and the so-called Mag7 companies, a relative gap the firm highlighted in its analysis.
Separately, recent regulatory filings and market moves have produced additional shifts in Nvidia holdings and partnerships. Filings disclosed that Nvidia has fully divested its stake in Recursion Pharmaceuticals, exiting a position that comprised 7.71 million shares and concluding a two-year investment in that biotech firm. In contrast, Nvidia has acquired 4.82 million shares of Synopsys, an accumulation valued at more than $2 billion that makes Nvidia the sixth largest shareholder in Synopsys and coincided with a roughly 3% rise in Synopsys stock.
Other filings revealed that Nvidia has eliminated its stakes in Applied Digital, Arm Holdings, and WeRide Inc. The divestment in Applied Digital corresponded with a 7.8% drop in that company's stock.
On the partnership front, Stifel maintained a Buy rating on Nvidia following announcement of an expanded collaboration with Meta aimed at broadening deployments of Nvidia technology across on-premises, cloud, and AI infrastructure.
Finally, financing activity tied to Nvidia hardware underscores ongoing demand for its GPUs. Data center startup Nscale secured a $1.4 billion loan from lenders that include Pimco and Blue Owl Capital to acquire Nvidia graphics processing units for customers in Europe.
Summary
RBC reiterated an Outperform rating and a $240 price target for Nvidia, forecasting a 3% to 4% quarterly beat-and-raise and expecting management to address or increase a backlog above $500 billion for 2025-2026. The firm is confident in gross margin outlooks despite rising memory prices and sees product launches and conferences as potential catalysts, while separate filings show Nvidia reshaping its investment portfolio and taking a large stake in Synopsys.
Key points
- RBC maintains Outperform on Nvidia with a $240.00 price target and models a 3%-4% beat for the upcoming quarter.
- Backlog of more than $500 billion for 2025 and 2026 is expected to be discussed or increased by management; supply-chain checks point to strong growth for Rubin into 2027.
- RBC is comfortable with gross margin projections despite higher memory costs, citing what it believes to be locked-in HBM pricing for 2026.
Risks and uncertainties
- Rising memory prices present a margin risk for semiconductor manufacturers and data center hardware suppliers, though RBC expects HBM pricing to be secured for 2026.
- RBC modeling excludes China sales of H200 chips, creating a source of potential upside or downside relative to current estimates depending on future inclusion.
- Market reactions to Nvidia portfolio changes - including divestments in Applied Digital, Arm Holdings, and WeRide Inc. - demonstrate that stake adjustments can produce material moves in smaller public stocks and create short-term volatility in related equity markets.