Nvidia Stock Stuck in Neutral Amid AI Boom Concerns
Nvidia's stock has been underperforming this year, falling in six of the past eight quarters, including the last four. The company's market cap is now over $5.2 trillion, and some analysts believe that investors may have a limited appetite for further exposure to Nvidia.
Raymond James analyst Simon Leopold lists four reasons why Nvidia's stock is lagging: how much more of the company can be owned, lack of belief in the AI boom, decelerating growth due to the law of large numbers, and peaking growth and peaking margins. Despite this, Leopold still rates the stock a Strong Buy.
Leopold believes that Nvidia's growing investment portfolio is a minimal risk, and that the company may be positioning itself for a major shift in its business model. He thinks that signs of Nvidia grabbing a bigger piece of the CPU market could be the next catalyst for the stock.