Shares of Nvidia (NVDA) are down in today’s trading after Phillip Securities downgraded the chipmaker from Buy to Accumulate due to its recent price movements. Despite the downgrade, the firm raised its price target slightly to $160 from $155. To be clear, the downgrade does not mean that the firm is bearish on Nvidia. In fact, Phillip Securities’ Accumulate rating suggests that Nvidia is expected to return 5%-20% to investors, while a Buy rating targets returns over 20%.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
Analyst Yik Ban Chong pointed out that there is strong demand for Nvidia’s H200 Hopper chips, which have hit “double-digit billions” in sales, and this demand is expected to stay strong until at least mid-2026. Furthermore, Nvidia’s new Blackwell chips are expected to beat earlier estimates of “several billion dollars.”
However, Phillip Securities predicts that Nvidia’s profit growth will slow down after mid-FY26 as Blackwell sales settle. Nevertheless, Nvidia is still the top player in AI GPUs, as its Blackwell chips deliver over twice the performance of its Hopper predecessor.
How Will Trade Tensions Impact Nvidia?
With Donald Trump returning to the White House soon, investors could be wondering how his trade policies would impact Nvidia’s operations. After all, he has been very vocal about his intentions to implement tariffs on imported goods. In this regard, Phillip Securities did note that tensions between the U.S. and China could hurt Nvidia’s stock price, as similar issues in 2018 caused shares to drop over 50%.
However, it is worth noting that Nvidia has less exposure to China now, as the region accounts for 13% of its revenue compared to 24% in 2019, therefore reducing the risk of a repeat from 2018.
What Is a Good Price for NVDA?
Turning to Wall Street, analysts have a Strong Buy consensus rating on NVDA stock based on 39 Buys, three Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After a 198% rally in its share price over the past year, the average NVDA price target of $165.18 per share implies 16.27% upside potential.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
