Investors are excited NVIDIA‘S (NVDA 0.57%) Quarterly earnings report on August 28. After recently falling below $100 per share, Nvidia’s stock price has risen about 30% in just two weeks.

But one Wall Street analyst believes there is more to come. In a new research report published on Monday, Ben Reitzes of Melius Research said he believes investors still have time to buy Nvidia shares, which he believes will reach $160 per share. That would mean another 23 percent upside for the semiconductor maker’s shares.

Spending on AI will generate enormous free cash flow

Spending on expanding the use of artificial intelligence (AI) by technology companies large and small has exploded. And Nvidia is the biggest beneficiary so far. Management itself expects revenue of around $28 billion in its upcoming earnings report. That would be more than double the $13.5 billion the company reported in the same period last year.

The company has significantly beaten its own revenue estimates in recent quarterly reports, so investors may be expecting more. Regardless of whether estimates are met or beaten, the Melius Research analyst sees enough market opportunity for Nvidia to generate rapidly increasing free cash flow in the near future.

Reitzes wrote in his research report that Nvidia “has the potential to generate over $270 billion in free cash flow over the next three years. Given this increase in cash flow, the company should be able to return an overwhelming portion of that money to shareholders.”

The recent rise in Nvidia stock may have already included some good news from the upcoming earnings report, so investors should not necessarily expect a share price increase after the report. However, in the long term, strong net earnings and cash flows should continue to be expected, making the stock a worthwhile buy.