AI Takes a Tumble on Analyst Downgrade - Credit: TipRanks

AI Takes a Tumble on Analyst Downgrade

Artificial intelligence (AI) stocks have been on a roller coaster ride in the markets this year, and one of them has just taken a tumble after an analyst downgrade. The stock in question is NVIDIA Corporation (NVDA), which saw its share price drop by more than 6% following the news.

The downgrade came from Goldman Sachs analyst Toshiya Hari, who lowered his rating for NVDA to “Neutral” from “Buy”. He also cut his 12-month price target for the stock from $600 to $500 per share. In addition, he noted that while NVDA had seen strong growth over the past few years due to its leadership position in AI and gaming chipsets, there were now signs of slowing demand as well as increasing competition from other chipmakers such as Intel Corp (INTC).

Hari believes that these factors could lead to lower margins and slower revenue growth going forward. He added that while NVDA still remains a leader in AI technology, it may not be able to maintain its current level of market dominance given the changing landscape. As such, he recommends investors take profits at this time and wait for better entry points before buying back into NVDA shares again.

In response to Hari’s comments, some analysts have argued that despite potential headwinds facing NVDA right now, it is still well positioned for long-term success thanks to its deep expertise in AI technologies and products like autonomous driving systems or data centers with high performance computing capabilities. They believe that any short-term dips should be viewed as buying opportunities rather than reasons for panic selling since they expect demand for these types of products will remain strong over time regardless of what happens with competitors like INTC or AMD Inc (AMD).

Overall then it seems clear that while investors may want to exercise caution when dealing with NVIDIA Corporation right now due to recent analyst downgrades and increased competition within the industry; those who are willing take a longer term view could find themselves rewarded if they buy into their shares at attractive prices during any dips caused by near-term volatility or uncertainty surrounding future prospects.

|AI Takes a Tumble on Analyst Downgrade|Technology|TipRanks

Original source article rewritten by our AI: TipRanks




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