Key Points
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Nvidia’s launch of its Rubin AI chips should provide a solid catalyst later this year.
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The company’s leadership in sovereign AI is another key tailwind.
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Wall Street expects an exceptional performance from Nvidia going forward, too.
- 10 stocks we like better than Nvidia ›
Have you ever read a book or watched a movie where the end was better than the beginning? I think this year will have a similar plot for Nvidia (NASDAQ: NVDA).
2026 hasn’t been great for the GPU stock so far. Nvidia’s lackluster performance can be attributed to several factors, including concerns about AI infrastructure spending and geopolitical uncertainty. However, I think investors will have more to cheer about by December. I’ll even step out on a limb and make a prediction: Nvidia’s stock will soar 40% by the end of 2026.
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Image source: Nvidia.
The coming Rubin rebound
Why am I so optimistic about Nvidia’s prospects over the next nine or so months? The company’s upcoming launch of its Rubin GPU platform is one key factor.
As impressive as Nvidia’s Blackwell chips are, Rubin will be even more powerful. The platform will deliver up to 10x lower inference token costs and require four times fewer GPUs to train mixture-of-experts (MoE) AI models compared with Blackwell.
I believe that the adoption of agentic AI will lay to rest most concerns about whether AI investments will pay off. Rubin is designed from the ground up to accelerate agentic AI. My hunch is that it will make chips based on the architecture a must-have for many companies.
Nvidia has already shipped samples of its first Vera Rubin chips, which combine the Vera CPUs with Rubin GPUs. The company is on track to begin production shipments in the second half of 2026.
If you doubt how highly anticipated Rubin is, just read what several top AI leaders have said about the platform. OpenAI CEO Sam Altman, Anthropic co-founder and CEO Dario Amodei, and several “Magnificent Seven” executives, including Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) CEO Sundar Pichai, are among those who have expressed enthusiasm.
Perhaps the highest praise, though, came from Elon Musk, who stated that “Rubin will be a rocket engine for AI.” Musk added, “If you want to train and deploy frontier models at scale, this is the infrastructure you use — and Rubin will remind the world that Nvidia is the gold standard.”
Sovereign support
Rubin isn’t the only reason why I expect a strong performance from Nvidia by year-end, though. The chipmaker should also have strong support from its sovereign AI business.
Sovereign AI is where nations use their own data, infrastructure, and other resources to develop and control AI systems rather than relying on foreign or third-party technology. With so much global uncertainty, it’s understandable why countries would want this capability.
In fiscal year 2026, Nvidia’s sovereign AI sales more than tripled year over year to over $30 billion. Canada, France, the Netherlands, Singapore, and the U.K. were the primary drivers of this growth.
Nvidia recently announced a key partnership with Palantir Technologies (NASDAQ: PLTR) related to sovereign AI. The two tech companies will deliver a turnkey AI datacenter solution that combines Nvidia’s Blackwell GPUs with Palantir’s software. This initiative should further establish Nvidia as the strongest player in the sovereign AI hardware space.
Wall Street concurs
I didn’t look to Wall Street to make my prediction. However, I wasn’t surprised to learn that many analysts are as bullish about Nvidia as I am.
All but two of the 58 analysts surveyed by S&P Global (NYSE: SPGI) this month rated Nvidia as a “buy” or “strong buy.” The consensus 12-month price target for Nvidia reflects a potential upside of roughly 45%. Some Wall Street firms, including Bernstein and Cantor Fitzgerald, have even loftier expectations.
Could my prediction — and Wall Street analysts — be wrong about Nvidia? Sure. Perhaps the conflict with Iran will ultimately lead to a stock market crash, bringing Nvidia’s shares down with the rest of the market. However, I’m not that pessimistic. The chances that Nvidia will deliver exceptional gains this year despite its rocky start seem to be quite good, in my opinion.
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Keith Speights has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Nvidia, Palantir Technologies, and S&P Global. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
