American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

Why two Wall Street firms remain cautious on Nvidia despite AI boom

by admin June 2, 2025
June 2, 2025
Why two Wall Street firms remain cautious on Nvidia despite AI boom

Nvidia Corp (NASDAQ: NVDA) has been in a sharp uptrend ever since the White House agreed to a 90-day trade truce with China.

Plus, the artificial intelligence behemoth recently reported its financial results for the first quarter that topped Street estimates and issued upbeat guidance for the future, further boosting confidence in NVDA.

However, not everyone on Wall Street is super bullish on Nvidia stock anymore. Analysts at HSBC as well as D.A. Davidson continue to rate the AI darling at “hold” only.

Why does D.A. Davidson remain dovish on Nvidia stock?

Following the company’s earnings release on May 28th, D.A. Davidson did raise its price target on NVDA shares to $135 – which is roughly in line with the price at which the AI darling is trading already.

Gil Luria, a senior analyst at the investment firm sees US chip export regulations that effectively disable the multinational from doing business in China as the largest overhang on Nvidia stock.

“It’s our belief that the Street is under-accounting Chinese contribution to Nvidia revenue,” he told clients in a research note this week, adding tightened export rules under the Trump administration will continue to hurt NVDA until we get a “resolution in one direction or the other”.

Note that Nvidia chief executive Jensen Huang has already confirmed that the chipmaker doesn’t have an alternative product at the moment, which could possibly help it resume business in China.

According to D.A. Davidson, the said restrictions are “handing the entire Chinese opportunity (estimated to be worth $50 billion as per Jensen Huang) to homegrown manufacturers such as Huawei.”

More importantly, as Huawei continues to advance in artificial intelligence, Nvidia may eventually have to fight for AI customers even outside of China.

Why does HSBC remain dovish on Nvidia stock?

HSBC analyst Frank Lee remains even more bearish on Nvidia stock for similar reasons, especially since China is “right behind” the US in artificial intelligence, as per Huang’s recent remarks.

Lee expects NVDA will make a comeback in AI chips in the world’s 2nd largest economy despite H20 restrictions – but supply chain mismatches, he argued in his latest research note, could remain a headwind for the semiconductor stock.

HSBC also raised its price target on the AI stock after the chipmaker’s Q1 earnings release like D.A. Davidson.

However, its upwardly revised price target of $125 indicates potential downside of about 8.0% from here.

It’s also worth mentioning that Jensen Huang expects US export restrictions to result in an $8.0 billion hit to sales in the company’s current financial quarter.

A 0.03% dividend yield tied to Nvidia stock at the time of writing is a bit too small to be any kind of a factor in deciding on buying NVDA.

The post Why two Wall Street firms remain cautious on Nvidia despite AI boom appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Trump’s tariff hikes cause steel stocks to fall across Asia
next post
IAG share price forecast as transatlantic demand starts to recover

Related Posts

Enphase Energy stock nears a pivotal price: buy...

September 12, 2024

Major US banks weigh joint stablecoin to counter...

May 23, 2025

US stocks open lower: Dow down 240 points,...

April 13, 2025

European stocks follow global peers after US Fed...

December 19, 2024

Asian markets mixed as Wall Street sell-off, German...

February 24, 2025

What is Apple’s ‘SOS mode’? iPhone feature lets...

February 27, 2024

Crude oil missing catalyst to lift prices; what’s...

December 21, 2024

Cathie Wood’s ARKK ETF is rising: is it...

April 29, 2025

Bitcoin approaches all-time high after surpassing $65,000

March 6, 2024

Here’s why the Nifty 50 index has moved...

November 15, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • GMS stock jumps 29% on takeover interest from Home Depot, QXO, analysts raise PTs

      June 22, 2025
    • Japan’s rice price surge: what’s driving it and why it could spark a political crisis

      June 22, 2025
    • BofA raises STOXX 600 target amid resilient global growth, warns on Mideast risks

      June 22, 2025
    • Palantir co-founder: US must prevent Iranian nukes

      June 22, 2025
    • Fed governor Waller advocates for July rate cut amid tariff, labor market outlook

      June 21, 2025

    Categories

    • Business (3,199)
    • Investing (2,531)
    • Latest News (2,000)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved