Two voices looked at NVIDIA Corporation (NASDAQ: NVDA) inside the same 12-hour window and prescribed opposite remedies. Pierre Ferragu of New Street Research says the stock reaches $400 within 18 months on earnings power alone. Jim Cramer says it needs a buyback so large that the company's existing authorization cannot come close to covering it. That disagreement is more telling than either headline on its own.
The case for Ferragu rests on a repricing argument. Speaking Tuesday morning, he called a $400 price target "very, very, very likely," pointing to Jensen Huang's guidance for at least 70% business growth next year. Ferragu described NVIDIA as operating in "halcyon days" with no visible cycle top, and argued that the stock is trading at single-digit earnings multiples against a forward earnings base most investors have not fully repriced. From the September 1 close of $217.44, a move to $400 implies roughly 84% upside and a market cap approaching $10 trillion.
The reported financials give that thesis something real to stand on. Q2 FY27 revenue came in at $96.22 billion, up 105.8% year over year, with Data Center revenue of $89.02 billion. Non-GAAP EPS of $2.22 marked the fifth consecutive beat. Analysts currently model FY2028 EPS of 13.1277 on revenue of $573.6 billion, and at $400 against those numbers the forward multiple lands in the low 30s, roughly where the stock trades today.
The counterargument
Cramer's position is that price discovery is broken and only mechanical intervention fixes it. He wants NVIDIA to repurchase roughly a tenth of its market cap, which against a $5.46 trillion valuation pencils out to more than $500 billion. The board authorized $80 billion in additional repurchase capacity on May 18, 2026, leaving approximately $99 billion remaining at quarter end. That is a fraction of the figure he is calling for. Cramer also recently disclosed his highest cash position in 25 years, which puts some distance between his personal posture and a prescription for the largest corporate repurchase in history.
On balance, the options market is positioned with Ferragu. The full-chain put/call ratio sits at 0.48, skewed toward calls. The stock was trading at $226.67 Wednesday morning, already moving in the direction his thesis requires. The buyback debate draws the headlines. The number that would compound is the one attached to $573.6 billion in projected FY2028 revenue.