Nvidia was climbing early on Monday. The artificial-intelligence chip maker has suffered a dip in recent weeks and Citi analysts are cutting their price-target on the stock.
Nvidia shares were up 2.3% at $170.93 in morning trading on Monday, after falling 2.7% on Friday.
The stock is down 8% over the past month, hit by a slump in the immediate aftermath of Nvidia’s earnings report. That was then exacerbated by results from rival AI chip company Broadcom, which said it expects its clients to make more use of Broadcom’s hardware at the expense of Nvidia’s graphics-processing units in future.
That has led Citi analyst Atif Malik to lower his target price on Nvidia stock to $200 from $210 in a research note Monday, although he kept a Buy rating. Malik estimated Broadcom’s deals could lead to a $12 billion loss in potential sales for Nvidia.
“Importantly, our estimates do not include China which could be a source of upside if and when Nvidia restarts GPU shipments to China,” Malik wrote.
However, robust AI spending should still be good news for the chip industry as a whole, Nvidia included. Meta Platforms CEO Mark Zuckerberg said Sunday that it was “quite possible” his company could invest more than a planned $600 billion in the U.S. through 2028 if AI progress keeps accelerating, in a post on the company’s social-media platform Threads.
“Easier monetary conditions combined with persistent easy financial conditions could trigger further acceleration in risk assets, as concerns around earnings growth from Nvidia are not enough to derail or even dent the prevailing AI theme,” wrote J.P. Morgan analyst Fabio Bassi in a research note.
Among other chip makers, Advanced Micro Devices fell 0.7% and Broadcom was up 4.6% in morning trading.
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