Nvidia shares experienced a downturn, trading 4.9 per cent lower at $US184.37 in New York at 2.15pm. This decline extends the stock’s retreat from its record high reached late last month, bringing the total drop to over 10 per cent. The dip occurs a week before the company is scheduled to release its quarterly results, which analysts expect will surpass previous forecasts, leading to some upward revisions of share price targets.
Despite the anticipated strong results, the share price retreat reflects growing apprehension regarding valuations, particularly among the megacap technology companies that have been instrumental in driving US equities to record highs. Oppenheimer on Thursday increased its price target for Nvidia to $US265 from $US225, reaffirming its outperform rating. Similarly, Susquehanna raised its target to $US230 from $US210, maintaining a positive rating on the stock.
Oppenheimer stated that Nvidia is ideally positioned to capitalize on advancements in artificial intelligence. Nvidia designs and manufactures graphics processors, chipsets, and related multimedia software. The company provides integrated full rack AI systems. These price target adjustments follow recent comments from Michael Burry, known for ‘The Big Short’, who disclosed a bet against Nvidia’s stock and questioned the profitability for hyperscalers, such as Meta, purchasing Nvidia’s chips.
