Nvidia (NASDAQ:) continues to be one of the most sought-after stocks in the technology sector. Analysts at Itau BBA offer a detailed assessment of the prospects and a fair price range for the semiconductor company’s shares.

Analysts recently examined several factors affecting Nvidia, including delays to the Blackwell chip and potential concerns about excessive capital spending (capex) at major technology companies.

Despite these challenges, Itau BBA expresses increasing confidence in Nvidia’s earnings performance for the next two to three quarters.

They believe that, contrary to popular belief, the delay at Blackwell could actually benefit short-term numbers, especially since the H200 chip is proving to be more profitable than the B100 or B200 models.

However, the analysts also highlight potential risks to Nvidia’s implied growth in calendar year 2026 (CY26). “To achieve a P/E of 30x in calendar year 2025, we believe NVDA should have at least 20% EPS growth in calendar year 2026,” writes Itau BBA.

A capital expenditure study based on Microsoft (NASDAQ:) spending suggests that if Nvidia continues to grow at this level, Microsoft’s capital expenditures could reach 100% of operating cash flow, or EBIT, by FY26, raising sustainability concerns.

To address these concerns, analysts point to the importance of accelerating AI adoption, citing Microsoft’s optimistic tone in a recent quarterly earnings call that highlighted the mass adoption of M365 Copilot as a potential driver for increased investment in AI infrastructure, which could benefit Nvidia.

“Overall, we expect NVDA to generate earnings per share of $5 to $6 in calendar year 2025. However, we believe we may experience a partial infrastructure wind-down phase sometime in calendar year 2026,” the company adds.

Itau BBA currently maintains its “outperform” rating on the stock, stating that its EPS forecast could result in a fair price range of $150 to $180 per share for NVDA (based on a P/E ratio of 30).