stock isn’t cheap enough to buy yet, according to Bernstein.
The back story. Nvidia shares (ticker: NVDA) are up about 19% this year, roughly matching the
which has risen nearly 20%. The stock is still down about 45% from last year’s highs.
Last month, Nvidia cited low visibility in the data center market as it withdrew the full-year guidance it had given just a few months earlier.
What’s new. On Wednesday, Bernstein analyst Stacy Rasgon reaffirmed his Market Perform rating for Nvidia stock, citing the risk to earnings estimates for the chip maker.
“We are not as inclined to buy the dip, and…are growing nervous on the shares,” he wrote. “While [Nvidia’s] valuation has come in somewhat, the shares still are not cheap.”
Nvidia shares are up 5.7% to $160.17 on Wednesday after a better than expected earnings report from chip maker Micron.
The analyst predicts fiscal 2021 Wall Street earnings estimates for Nvidia are likely to come down because of the difficult industry demand environment.
“We recommend that investors evaluating the name tread somewhat lightly at the moment, with the potential for better entry points to come,” he wrote.
Looking ahead. Rasgon reiterated his $150 price target for Nvidia shares.
Write to Tae Kim at [email protected]