Nvidia (NVDA)
Down 5% in the past 6 months after running up over 59% this past year, Nvidia is looking like a great buying opportunity with a PEG ratio of just 0.7 – something almost inconceivable considering its size. For reference, the S&P has a PEG of around 1.8 right now which makes Nvidia stock look twice as attractive when it comes to a valuation/growth basis. With a TTM EPS of $4.90 and forecasts showing $7.66 for Jan 2027, it’s likely to see a 59% increase to its earnings in just 9 months.
Nvidia’s valuation is still high at a 36 PE but they’ve beat their latest 4 earnings calls and are still buying back shares which typically indicates that management views the shares as being undervalued. But what makes NVDA truly special is their dominance in the AI data centre GPU market which has been growing rapidly over the past few years, with some analysts estimating that Nvidia currently holds as much of a 98% market share. While this figure is likely overstated, it’s clear their market share is at least somewhere in the vicinity and continues to grow which is the important part.
The average analyst rating for NVDA is a Strong Buy with a +54% one year forecast, and we have it as a medium risk high reward stock. Our current rating for Nvidia is a Buy with a +24% one year forecast.
Broadcom (AVGO)
Up 89% in the past year, Broadcom is certainly more mature as a company and is seen less as of a growth stock when compared to something like Nvidia; but don’t be fooled – AVGO currently has a PEG ratio of 1.1 with 1 year EPS growth forecasts of 53% and a 60 PE. So while valuation is on the high side, they certainly have enough EPS growth to at least make this an attractive offer when compared to the overall market that has a PEG of around 1.8 right now.
One thing we like about Broadcom in particular is their 16 years of consecutive dividend increases and their recent earnings beats. We have forecasted AVGO reaching the $400 per share milestone in January 2027 and put this as a medium risk, high reward stock.
We have AVGO rated as Strong Buy with a 1 year forecast of +20%, and the average analyst estimate is also a Strong Buy but with a 32% one year forecast.
So when compared to Nvidia, on a growth to valuation basis like the PEG ratio it looks like NVDA is the better deal right now; but both are definitely worth considering given their ability to rapidly grow earnings.
Topics: NVDA stock vs AVGO, Should I buy Nvidia stock or Broadcom, NVDA stock price prediction, AVGO 2027 price projection
