BofA Earnings Preview on $NVDA: Analyst comments: "FQ2 should deliver the usual 3-4% sales beat/raise on the Vera Rubin ramp, but the headline is the least interesting part. What matters is Nvidia's potential disclosure of its multi-year, off-balance-sheet commitments to lock down supply, power, models, and demand. Quantifying these liabilities won't erase AI buildout risk, but it lets the market properly price what we see as a depressed valuation. NVDA's first mega-deal, the $100B/10GW OpenAI investment in Sep. 2025, marked trading near its 5-year historical forward EV/EBITDA median of ~27x. The multiple has since collapsed 44% to ~15x, less than half of peer AMD's ~32x. That haircut overstates the worst-case ~$500B (10% of EV) funding burden. Our estimate includes the $150-$200B required for multi-year purchase commitments and cloud service agreements. In a bull case of resilient demand, NVDA may never shoulder the cost of unused capacity or stranded assets at all. NVDA has called AI's dawn the industry's 'iPhone moment.' NVDA should finish the analogy on cash returns. From FY13-25, Apple returned 82% of FCF, retiring ~43% of shares, and that FY13 buyback pivot put a floor under the stock, lifting it from 4x to 25x EV/EBITDA currently. Different cycles, lower capex, recurring services—all caveats apply—but NVDA's ~37% FCF payout (FY27/28 consensus) looks modest. A move to 50-75% could offer real support. By next year, NVDA could be generating nearly $1B daily in free cash flow, providing it more than enough firepower to support ecosystem commitments and dedicate a meaningful amount toward supporting the stock." Analyst: Not provided

BofA Earnings Preview on $NVDA: Analyst comments: "FQ2 should deliver the usual 3-4% sales beat/raise on the Vera Rubin ramp, but the headline is the least interesting part. What matters is Nvidia's potential disclosure of its multi-year, off-balance-sheet commitments to lock down supply, power, models, and demand. Quantifying these liabilities won't erase AI buildout risk, but it lets the market properly price what we see as a depressed valuation. NVDA's first mega-deal, the $100B/10GW OpenAI investment in Sep. 2025, marked trading near its 5-year historical forward EV/EBITDA median of ~27x. The multiple has since collapsed 44% to ~15x, less than half of peer AMD's ~32x. That haircut overstates the worst-case ~$500B (10% of EV) funding burden. Our estimate includes the $150-$200B required for multi-year purchase commitments and cloud service agreements. In a bull case of resilient demand, NVDA may never shoulder the cost of unused capacity or stranded assets at all. NVDA has called AI's dawn the industry's 'iPhone moment.' NVDA should finish the analogy on cash returns. From FY13-25, Apple returned 82% of FCF, retiring ~43% of shares, and that FY13 buyback pivot put a floor under the stock, lifting it from 4x to 25x EV/EBITDA currently. Different cycles, lower capex, recurring services—all caveats apply—but NVDA's ~37% FCF payout (FY27/28 consensus) looks modest. A move to 50-75% could offer real support. By next year, NVDA could be generating nearly $1B daily in free cash flow, providing it more than enough firepower to support ecosystem commitments and dedicate a meaningful amount toward supporting the stock." Analyst: Not provided

Source:https://x.com/epictrades1/status/2092559861938532763