Nvidia Stock at $ 60?

Question: How would you react if you held Stock Nvidia (Nasdaq: NVDA) And its value has dropped 60% or more in the coming months? Although it may seem extreme, such an event has happened before and could repeat itself. Earlier this year, NVIDIA’s shares experienced a sale, from around $ 148 in mid-January to around $ 115 now, which is a drop of almost 23%. This decrease was fed by several factors, such as the introduction of more efficient AI models such as China’s depth and concerns and the deceleration of investment in the generative could reduce NVIDIA GPU demand. In addition, the global market is undergoing a large sale, stimulated by increasing concerns concerning an American recession following prices imposed by President Donald Trump on the main business partners. Moreover, see Is a new CEO sufficient to put Intel back on the right track?

Here is the point: The key point is that during a slowdown, NVDA action could undergo substantial losses. The 2022 data indicates that the NVDA stock lost more than 60% of its value in a few quarters. Currently, NVIDIA shares have increased from $ 148 to $ 115 in about two months. This raises the question: could the stock continue its downward trend and reach around $ 60 if a similar situation should take place? Naturally, individual stocks are generally more volatile than diversified portfolios. Therefore, if you are looking for growth with reduced volatility, you could consider the High quality walletwhich has surpassed the S&P 500 and generated yields of more than 91% since its creation.

Why is it relevant now?

Slowdown in AI’s demand: Over the past two years, companies have invested considerably in the training of AI models, NVIDIA GPUs becoming the preferred option because of their performance and their efficiency. Short -term perspectives remain robust, as technology giants such as Google and Microsoft increase capital expenditure for 2025 to extend their Cloud IA infrastructure. However, the request could possibly weaken. Since training on the AI ​​model is mainly a unique process with a high computing intensity, it could possibly deceive. As the models increase in size, progressive performance improvements should decrease and the supply of high -quality training data could become a limiting factor. Consequently, as the demand for training decreases, GPU sales could also decrease. Therefore, as discussed in our Analysis here on the macro imageThe American economy could enter a slowdown, potentially even a recession, which could still affect GPU sales. Since IA investments continue to be unprofitable for most companies, they can be main candidates for cost reduction measures during an economic slowdown. This situation could have a significant impact on Nvidia.

Transition to more resource economy models could also affect Nvidia. The China Deepseek model, launched in January, drew attention to prioritize software -oriented optimization instead of relying on hardware, which could potentially reduce GPU demand. The company reports that it only spent $ 5.5 million to form its V3 model, which is only a fraction of hundreds of millions that companies like Openai would have spent. Since the Deepseek model is open source, large technological companies could adopt similar costs reduction strategies. If this approach is widely implemented, it could further reduce the request for power to calculate the AI. For more information, see How Deepceek has an impact on Nvidia

THE The US government has imposed export control restrictions on most of the latest NVIDIA AI chipset products intended for ChinaWith the exception of H20 fleas, citing national security problems. Nevertheless, reports indicate that resellers on the gray market use entities recorded outside of China to buy servers equipped with the latest Nvidia products from companies from various countries, notably Singapore, Malaysia, Taiwan and Vietnam. This is particularly worrying because Singapore has become the second Nvidia market, generating about 23 billion dollars in sales during fiscal year 25 (approximately 18% of income), compared to only $ 2.3 billion (8% of income) in financial year 23. Singapore has now launched a survey on these potential shortcomings. These developments could potentially affect Nvidia’s overall income to some extent. For more details, see How Trump’s prices affect Nvidia’s stock.

To what extent is the NVDA stock resilient during a slowdown?

The NVDA stock experienced a drop which was slightly more serious than that of the S&P 500 reference index during certain recent slowdowns. Are you concerned about how a market accident could affect NVDA actions? Our dashboard How much can NVIDIA actions go to a market crash? Provides a detailed analysis of stock performance during and following market plantations.

Inflation shock (2022)

• The NVDA title has decreased by 62.7% a peak of $ 30.12 on January 3, 2022 to $ 11.23 on October 16, 2022, compared to a 25.4% peak drop for the S&P 500
• The stock completely rebounded at its peak before the crisis on May 17, 2023
• Since then, he has reached a summit of $ 149.43 on January 6, 2025 and is currently negotiated at around $ 115

Covid pandemic (2020)

• The NVDA stock fell from 37.6% of a summit of $ 7.87 on February 19, 2020 to $ 4.91 on March 16, 2020, compared to a 33.9% Decline for the S&P 500
• The title has completely recovered at its peak before the crisis of May 11, 2020

Global financial crisis (2008)

• The NVDA title has decreased by 85.1% of a summit of $ 0.99 on October 17, 2007 at $ 0.15 on November 20, 2008, compared to a 56.8% Drop for the S&P 500
• The stock completely rebounded at its peak before the crisis of May 13, 2016

Assessment

Nvidia’s income have soared, increasing at an average rate of 80.1% in the past three years, which is significantly higher than the 6.3% increase in S&P 500 income. However, NVIDIA’s evaluation remains attractive given its strong growth, shares negotiating at around 26x FY’26 consensus. However, there are potential risks. During the last quarters, net margins exceeded 50% of 50%, powered by a robust pricing power and a high demand for IA fleas. However, these margins could be threatened if demand decreases or if the competition intensifies. A slowdown in demand could lead to a price reduction, a drop in sales volumes and a significant drop in profitability. By the way, see the big movement in this quantum computer stock in What is going on with the QBTS stock?

Given the potential for slowing growth and wider economic uncertainties, Ask yourself this question: Are you going to continue holding your NVDA stock, or are you going to panic and sell if it starts to fall to $ 70, $ 60 or even lower prices? It is always difficult to maintain a position in a drop in stock. Trefis is associated with the management of empirical assets – a wealth manager of the Boston region – whose asset allocation strategies provided positive yields during the period 2008-2009, when the S&P lost more than 40%. Empirical incorporated the Portfolio Trefis HQ in this asset allocation framework to provide customers with better yields and reduced risks compared to the reference index, offering a less volatile experience as demonstrated by the Headquarters performance metrics.

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