John Nowacky
Wedbush analyst Dan Ives has voiced his strong opposition to the recent downgrade of Nvidia Corp. by New Street Research, citing the AI revolution as a significant factor. In a post on X, Ives emphasized that the AI revolution, led by Nvidia and its CEO Jensen Huang, is just beginning.
New Street Research’s Pierre Ferragu downgraded Nvidia to neutral, expressing concerns about the stock’s overvaluation. Ferragu pointed out that the demand for Nvidia’s products is in line with expectations, leading to the decision to downgrade the stock. However, Ives strongly disagreed with this perspective, asserting that the AI revolution is still in its early stages and that Nvidia is at the forefront.
Nvidia’s stock has experienced some volatility recently, with the rare downgrade from New Street Research contributing to the uncertainty. The analyst expressed doubts about any potential additional upside for the stock and warned of a potential risk of derating if the current outlook remains unchanged.
Despite the concerns, Ives has been a vocal advocate for Nvidia’s impact on the tech industry. He has previously highlighted the significant influence of Nvidia’s expansion, noting that every dollar spent on the company’s chips generates $8 to $10 in the rest of the sector.
However, Nvidia’s stock faced additional challenges with European Union competition chief Margrethe Vestager highlighting a significant “bottleneck” in Nvidia AI chip supply.
As of Friday’s closing, Nvidia’s stock was valued at $125.83, experiencing a decline of 1.91% for the day. In after-hours trading, the stock further decreased by 0.36%. Nevertheless, Nvidia has shown substantial growth, surging by 161.22% year to date, according to data from Benzinga Pro.
Additional facts:
– Nvidia is a leading technology company known for its graphics processing units (GPUs) and artificial intelligence (AI) capabilities.
– Nvidia’s GPUs are widely used in gaming, data centers, and autonomous vehicles.
– The company has made significant advancements in AI, particularly with its CUDA platform that allows developers to accelerate AI workflows.
– Nvidia’s CEO, Jensen Huang, has been recognized as a key figure in driving the AI revolution.
– The demand for Nvidia’s products has been fueled by the increasing need for AI processing power in various industries.
– Nvidia’s GPUs are also used in cryptocurrency mining, which has contributed to their popularity and profitability.
Most important questions and answers:
1. Why did Dan Ives disagree with the downgrade of Nvidia by New Street Research?
Dan Ives believed that the AI revolution, led by Nvidia, is just beginning and that the company is at the forefront of this transformation. He disagreed with the perspective that Nvidia’s stock was overvalued and highlighted the potential for future growth.
2. What are the key challenges or controversies associated with Nvidia’s AI chip supply?
The European Union competition chief, Margrethe Vestager, raised concerns about a “bottleneck” in Nvidia AI chip supply. This suggests that there may be constraints in meeting the demand for Nvidia’s AI chips, which could impact the company’s growth and market performance.
Advantages:
– Nvidia is a leader in the AI industry and has a strong track record of innovation.
– The increasing demand for AI processing power presents significant growth opportunities for the company.
– Nvidia’s GPUs have a wide range of applications, including gaming, data centers, and autonomous vehicles.
– The company’s expansion has ripple effects in the tech sector, generating additional revenue for other industry players.
– Nvidia’s stock has shown substantial growth, signifying investor confidence in the company’s future prospects.
Disadvantages:
– The recent downgrade and concerns about overvaluation may introduce uncertainties for investors.
– The potential bottleneck in Nvidia’s AI chip supply could impact its ability to meet market demand.
– Volatility in stock performance can create instability in the market and affect investor sentiment.
Suggested related link:
– Nvidia official website
