Analyst unveils startling Nvidia stock forecast amid tariffs
The stock market took another hit after President Donald Trump announced sweeping tariffs of 10% or higher on some countries, escalating fears of a global trade war and adding pressure to an already struggling U.S. economy.
The S&P 500 dropped 4%. The tech-heavy Nasdaq Composite lost 5%. Nvidia, one of the winners for 2024, is down 6%.
💵💰Don't miss the move: Subscribe to TheStreet's free daily newsletter 💰💵
Severe tariffs could tip the economy into a slowdown and raise already stubborn inflation.
'This was the worst-case scenario for tariffs and were not priced into the markets,' Mary Ann Bartels, chief investment strategist, Sanctuary Wealth, told CNBC. 'The big question is if 5,500 can hold on the S&P 500. If it cannot hold, we may see another 5-10% downside.'
Nvidia's stock has struggled for weeks, and the strain may be growing.
Nvidia's () share price is down 26% from its peak in January. The company is facing pressures on China's cheaper AI model DeepSeek's rollout, disappointing earnings, and a broader tech sell-off caused by economic uncertainties.
In February, the company reported fiscal Q4 revenue of $39.3 billion, a 78% surge from the year-earlier period. However, the growth largely slowed from the 265% the company posted a year earlier. Revenue growth from its key data center segment also slowed down.Despite Nvidia CEO Jensen Huang highlighting many times that the demand for Blackwell is "extraordinary," keeping up with that demand has started to pressure the company's profit margins.
Nvidia reported a non-GAAP 73.5% gross margin for the quarter, 3.2 points shy of a year earlier. The company attributed the smaller profit margin to newer, more complicated, and costly data center products, including Blackwell.
Now, the company could face more trouble because of tariffs.
Nvidia's supply chain is mainly concentrated in the Asia-Pacific region. For the production of its chips, it is highly dependent on foundries such as Taiwan Semiconductor Manufacturing Company (TSM).The White House has said semiconductors would not be subject to the latest tariff. Still, potential retaliatory tariffs from other countries and the escalation of trade wars could weigh on Nvidia's business, as more than half of its revenue comes from sales outside the U.S.
Wall Street analysts are also questioning Nvidia's pricing ability.
HSBC has downgraded Nvidia to Hold from Buy with a price target of $120, down from $175, thefly.com reported on April 3.
The analyst sees limited GPU pricing power going forward that caps earnings upside potential until opportunities evolve in robotics, autos and AI markets.
'Increasing mismatches and inconsistencies in Nvidia's supply chain continue to grow and hence we believe it would be difficult for our bull case scenario, which suggests earnings upside potential, to materialize,' the analyst wrote.
More Nvidia:
Nvidia stock: The AI tailwind could just be getting started
Nvidia stakes out aggressive future, despite investor unease
AI bet from tech upstart could be a major blow to Nvidia
The firm sees limited room for significant earnings upside surprise over the next one to two years and potential re-rating headwinds that it thinks are "yet to be fully factored in by the market."
Nvidia trades at $103 on April 3.Sign in to access your portfolio
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles

Yahoo
33 minutes ago
- Yahoo
US still dependent on Canadian oil, despite Trump's claims, Cenovus CEO says
CALGARY (Reuters) -The U.S. is still reliant on Canadian oil imports, despite claims made by U.S. President Donald Trump, Cenovus Energy's CEO said on Tuesday at a conference in Calgary, Alberta. Trump has threatened on-again, off-again tariffs on Canada's oil, of which nearly 4 million barrels per day are exported to the United States. Canada also remains dependent on U.S. energy systems, Cenovus CEO Jon McKenzie said, adding the country must diversify its customer base. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
37 minutes ago
- Yahoo
INTC Plunges 35% in the Past Year: Should You Dump the Stock?
Intel Corporation INTC has plunged 35.1% over the past year against the industry's growth of 12.3%, lagging its peers Advanced Micro Devices, Inc. AMD and NVIDIA Corporation NVDA. While NVIDIA stock is up 16.4%, Advanced Micro has declined 27.5% over this period. Much of Intel's underperformance is attributable to the severe financial difficulties and operational challenges as it plays a catch-up game with its rivals. One-Year INTC Stock Price Performance Image Source: Zacks Investment Research While most of the competitors evolved with the changing demand patterns, Intel fell behind others as it hung on to its legacy products. For example, despite making significant inroads in AI (artificial intelligence) chips, Intel lagged NVIDIA on the innovation front with the latter's H100 and Blackwell graphics processing units (GPUs) being runaway successes. This offered a competitive advantage to NVIDIA, with leading technology companies reportedly piling up NVIDIA's GPUs to build clusters of computers for their AI work. Moreover, Intel has been facing challenges due to the disruptive rise of over-the-top service providers in this dynamic industry. Price-sensitive competition for customer retention in the core business is expected to intensify in the coming days. Aggressive competition is likely to limit the ability to attract and retain customers and affect operating and financial results. Image Source: Zacks Investment Research An accelerated ramp-up of AI PCs has significantly affected Intel's short-term margins, as it shifted production to its high-volume facility in Ireland, where wafer costs are typically higher. Margins were also adversely impacted by higher charges related to non-core businesses, charges associated with unused capacity and an unfavorable product mix. Competitive pricing pressure from rivals has further dented its accounted for more than 29% of Intel's total revenues in 2024, making it the single largest market for the company. However, the communist nation's purported move to replace U.S.-made chips with domestic alternatives significantly affected INTC's revenue prospects. The directive to phase out foreign chips from key telecom networks by 2027 underscores Beijing's accelerating efforts to reduce reliance on Western technology amid escalating U.S.-China trade and tariff Washington tightens restrictions on high-tech exports to China, Beijing has intensified its push for self-sufficiency in critical industries. This shift poses a dual challenge for Intel, as it faces potential market restrictions and increased competition from domestic chipmakers. In addition, weaker spending across consumer and enterprise markets, especially in China, resulted in elevated customer inventory levels. Earnings estimates for Intel for 2025 have moved down 40.8% to 29 cents over the past year, while the same for 2026 has declined 31.2% to 77 cents. The negative estimate revision depicts bearish sentiments for the stock. Image Source: Zacks Investment Research Intel is investing to expand its manufacturing capacity to accelerate its IDM 2.0 (Integrated Device Manufacturing) strategy. Interim management is committed to keeping the core strategy unchanged despite efforts to drive operational efficiency and agility. The company is emphasizing the diligent execution of operational goals to establish itself as a leading foundry. Its latest Xeon 6 processors with Performance-cores (P-Cores) can support large AI workloads across diverse sectors. With industry-leading capabilities in AI processing, the Xeon 6 family delivers the industry's best CPU for AI at a lower total cost of ownership. Intel's innovative AI solutions are set to benefit the broader semiconductor ecosystem by driving down costs, improving performance and fostering an open, scalable AI environment. The company has received $7.86 billion in direct funding from the U.S. Department of Commerce for its commercial semiconductor manufacturing projects under the U.S. CHIPS and Science Act. The funds will support Intel in advancing critical semiconductor manufacturing and advanced packaging projects in Arizona, New Mexico, Ohio and Oregon, likely paving the way for innovation and remains on track with its 5N4Y (five nodes in four years) program to regain transistor performance and power performance leadership by 2025. Intel Xeon platforms have reportedly set the benchmark in 5G cloud-native core with substantial performance and power-efficiency improvements, additional power-saving capabilities and easy-to-deploy software. This has triggered healthy demand trends from major telecom equipment manufacturers and independent software vendors to optimize and unleash proven power savings for a more sustainable future. Intel's innovative AI solutions hold immense promise for the broader semiconductor ecosystem. By addressing the challenges of scalability, performance and interoperability, it is paving the way for widespread AI adoption across enterprises worldwide. Management is focusing on simplifying parts of its portfolio to unlock efficiencies and create value. However, the recent product launches appear 'too little, too late' for Intel. In addition, margin woes amid strict export restrictions, unfavorable product mix and elevated customer inventory levels weigh on its bottom line. Declining earnings estimates remain an overhang. With a Zacks Rank #3 (Hold), Intel appears to be treading in the middle of the road, and investors could be better off if they exercise caution and stay invested for long-term gains. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intel Corporation (INTC) : Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
43 minutes ago
- Yahoo
Pre-Market Futures Have Fingers Crossed for Trade Deals
Tuesday, June 10, 2025Pre-market futures are climbing back to early-morning highs at this hour, as the most consequential of new economic reports don't hit the tape until tomorrow and Thursday. Talks resume today in London between the U.S. and China, and a breakthrough on that front in the trade war would be a compelling reason to drive markets the other hand, any reported impasses on this front might be seen as a wet blanket for market growth. We can see by the generally positive daily returns this month that market participants are ready to hear some good news: the Dow is up +2.5% off late-May lows, the S&P is +3.4% over that time, the Nasdaq is +4.2% and the small-cap Russell 2000 +5.3%.Earlier this morning, the latest NFIB Small-Business Index came out for the month of May, looking better than it has in the previous couple months. A headline of 98.8 was 3 points higher than anticipated (95.9 was the consensus estimate), just above the index's long-term average, which reaches back 51 years. The 12 month high was back in December, when this index reached those small-business owners surveyed, uncertainty was still high — likely reflecting the still-murky tariff policy looking forward. We're now within the final month of the 90-day tariff pause, with so far very little progress made. That said, a plurality of owners said taxes, not tariffs or inflation, are the biggest problem facing their businesses currently — 18%. The last time the survey named taxes as the top issue was back in morning brings us the all-important Consumer Price Index (CPI) for May, which is expected to rise steadily month over month by +0.2% and +0.3% on core (stripping out volatile food & energy costs), while the year-over-year Inflation Rate is expected to tick up 10 basis points (bps) to +2.4%, core year over year to +2.9%.Thursday's Producer Price Index (PPI) reported those same +2.4% and +2.9% on core year-over-year rates last month for the wholesale side. Expectations are for month-over-month headline PPI to swing back to positive +0.2% from April's -0.5%, with core expected to fetch +0.3% growth last month, from -0.1% of these would be bad numbers — and there is always a possibility they could surprise to the downside, which would be good for disinflationary aspirations. But should these figures come in as expected, at levels still above the Fed's optimal +2% inflation rate and moving the wrong direction, you can write it in ink that the Fed will not cut interest rates at its next FOMC meeting starting a week from fact, despite early-year projections that the economy would be in a good place to start cutting rates this month, currently it's September that's the odds-on favorite for the first 25 bps rate cut this year. Also, more analysts and economists are projecting no new moves from the Fed's current +4.25-4.50%, which has been in place from December, for the entirety of or comments about this article and/or author? Click here>> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco QQQ (QQQ): ETF Research Reports SPDR S&P 500 ETF (SPY): ETF Research Reports SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Errore nel recupero dei dati Effettua l'accesso per consultare il tuo portafoglio Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati