2024-04-22 13:11:23 ET
Summary
- Nvidia Corporation stock price has experienced significant growth, but recently slid by 10% on April 19, 2024.
- Nvidia's trajectory may mirror that of Tesla's fall from 2021.
- Nvidia's sales are concentrated to enterprises, which make it vulnerable to customer substitution efforts, resulting in increased competition and potential loss of market share/profit margins.
Nvidia Corporation’s ( NVDA ) stock price has been on a tear since October 2022, rising from a low of $108/share to $974 in March 2024. Recently, the stock price has slid to $762, falling by 10% on Friday, April 19, 2024 (the market cap is still $1.9 trillion). Is it a buy or sell? I think its trajectory may mirror that of Tesla ( TSLA ) starting in 2021. I base this view not on artificial intelligence’s ((AI)) prospects, but because I believe markets are underestimating the incentive that Magnificent Seven have to develop alternatives and its impact on NVDA, in a nutshell: increased competition....
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For further details see:
Nvidia: Significant Downside Risks As Its Customers Develop AI Chips