‘A Crash May Be Imminent,’ Says Investor About Nvidia Stock – TipRanks
2025-04-25T00:11:35Z
Nvidia (NASDAQ:NVDA) investors had reason to smile this week, as the Trump administration signaled that it would be easing up on its aggressive stance vis-a-vis Chi…
Nvidia (NASDAQ:NVDA) investors had reason to smile this week, as the Trump administration signaled that it would be easing up on its aggressive stance vis-a-vis China.
President Trump’s assertion that he would be “very nice” to China in order to reach a trade arrangement was further confirmed the day after by Treasury Secretary Scott Bessent, who acknowledged that the current tariff levels are not “sustainable.”
Wall Street liked what it heard. Nvidia stock rallied nearly 7% in the days that followed, even though it’s still nursing a 21% loss on the year.
But not everyone is convinced the worst is over. One investor, known by the pseudonym Nexus Research, warns that Nvidia could be in for a brutal drop – potentially 50–60% – and not just because of geopolitical headwinds.
According to Nexus, Nvidia’s biggest threat might not be Washington – it could be Huawei. The Chinese tech giant stands to capitalize on Nvidia’s lost China sales, which made up 13% of NVDA’s fiscal 2025 revenue. Worse still, Huawei is aiming to take the fight global, reportedly pitching a supercomputing system it claims outmuscles Nvidia’s.
Another threat facing Nvidia is the prospect of decreasing capex spending among the hyperscalers due to an oversupply of data centers. Nexus cites recent reports that both Microsoft and Amazon are canceling or postponing data center leases, indicating that a slowdown in AI spending could be imminent.
Even so, Nexus isn’t sounding the full alarm. Despite short-term risks, Nvidia’s Forward PEG ratio of 0.62x implies the stock may be undervalued. So rather than a bearish call to sell, Nexus is leaning neutral with a Hold rating. (To watch Nexus Research’s track record, click here)
Wall Street is significantly more bullish than Nexus. Nvidia currently boasts a Strong Buy consensus rating, backed by 37 Buy recommendations and just 5 Holds. Analysts are targeting a 12-month average price of $168.49, implying a 58% upside from here. (See NVDA stock forecast)
To find good ideas for AI stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Disclaimer & DisclosureReport an Issue
Auto-posted from news source
About The Author
