NVIDIA (Nasdaq: NVDA)) There is no shortage of fans at Wall Street – and for a good reason. The chip titan was at the heart of the Rally based on AI, turning into one of the most dominant societies in the world.
However, even market darlings can trip, and 2025 has been difficult so far. The shares are down 27% for the start of the year, which raised questions about the question of whether the Bull Run has hit a wall.
In the midst of the growing prudence of investors, an analyst warns that the days of glory – at least for the moment – can be behind.
“We are now expected to see a potential that is limited to the future, given the limited place for significant surprise income in the next 1 to 2 years and the potential re -evaluation winds that we still think we are fully taken into account by the market,” said Frank Lee, HSBC analyst.
NVIDIA has regularly delivered flashing benefits of beating, but in the last three quarters, the profits and the orientation rhythms have shrunk. Lee believes that this is due to a persistent uncertainty surrounding the rise of its Blackwell supply chain – in particular linked to its architecture NVL Rack.
“More importantly,” continues Lee, “we think that the pricing power of its GPU roadmap slows down, and this was a key engine of its surprise upwards in the momentum in the previous quarters.”
Nvidia’s pricing power has increased considerably, from $ 1,000 for its game GPU $ 13,500 with the launch of its first generation IA GPU platform, ampère. Subsequent platforms – Hopper and Blackwell – have experienced additional ASP (average selling prices) increases of 96% and 51%, respectively. The beginnings of the architecture of Rack Blackwell NVL72 marked another major jump, considerably increasing the prices of the previous HGX platform range from $ 212,000 to $ 320,000 (which included 8 Hopper or Blackwell GPU) to $ 2,623,500 (a configuration of 72 Blackwell GPUS, 36 CPUS Grace and 9 Chips).
Lee underlines that there was no notable ASP increase between GPUs B200 and B300 or between Rack architectures GB200 and GB300 NVL72. This is probably due to the fact that upgrades B300 / GB300 focuses less on performance and more on incremental improvements – like a modest HBM3E 8HI memory bump at HBM3E 12HI – and improvements in system stability, aimed at solving problems such as overheating and lower yield rates observed in the B200 / GB200.
Consequently, Lee has reduced its Fy26 / Fy27 EPS forecasts by 8% and 18%, respectively, to take into account reduced expectations for NVL servers’ shipments. The new BPA estimates of $ 4.72 for financial year 26 and $ 5.76 for financial year 27 are now closer to the respective consensus estimates of $ 4.59 and $ 5.80, suggesting a “limited range for an upward surprise”.
At the same time, Lee resumed his position on NVDA actions, going from a purchase note to a socket (that is to say neutral), while reducing his price target from $ 175 to $ 120. Despite this, this always leaves room for an increase of ~ 23% of the current levels. (To look at the history of Lee, Click here))
3 Other analysts join Lee on the key, but with 37 additional purchases, consensual view is that NVDA action is a strong purchase. Based on the average price target of $ 175.06, NVDA shares could be negotiated almost 79% up per year. (See NVDA actions forecast))
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Warning: The opinions expressed in this article are only those of the featured analyst. Content is intended to be used for information only. It is very important to do your own analysis before investing.