Analyst predicts 28% decline in Nvidia stock due to potential slowdown in tech companies' spending

From Nasdaq: 2024-05-06 05:50:00

Nvidia’s stock has surged over the past year, but one analyst predicts a 28% decline in the next 12 months. D.A. Davidson’s Gil Luria cites a potential slowdown in spending by major tech companies like Google and Amazon, who are developing their own AI chips. Some have turned to Nvidia’s rival, AMD. Other experts voice concerns over inflated expectations and valuations for Nvidia.

While most analysts are bullish on Nvidia, some warn of risks. Richard Hunter and Aswath Damodaran caution about inflated expectations, strained relations with China, and high valuations. Damodaran plans to sell half of his Nvidia stock due to its premium price. The debate over Nvidia’s future performance continues among financial experts.

Despite conflicting views, Nvidia’s first-mover advantage in AI chips and strong demand could keep the stock buoyant. While negative predictions loom, investors should weigh the risks and rewards carefully. The stock’s performance will ultimately depend on factors like demand for AI chips and competition from other companies. A steep decline in Nvidia’s share price could create a buying opportunity for investors.



Read more at Nasdaq: 1 Wall Street Analyst Thinks Nvidia Stock Will Plunge 28%. Is He Right?