Why did Nvidia stock fall today? Baird downgrade hits high-flyer
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Nvidia (NASDAQ:NVDA) shares fell sharply on Monday as investment firm Baird downgraded the semiconductor giant on worries over order cancellations and slowing PC growth.
Analyst Tristan Gerra cut his rating on Nvidia (NVDA) to neutral from outperform and lowered the price target significantly to $225 from $360, as the analyst said that consumer GPUs have recently started to see some order cancellations as a result of "excess inventories."
Gerra also pointed out that a slowdown in PC demand and the Russian embargo sanctions will hurt the company's sales.
Nvidia (NVDA) fell more than 5% to $218.80 on Monday, nearing a one-month low.
Gerra also pointed out that the upcoming fork for cryptocurrency Ethereum could "compound the demand weakness" for GPUs, adversely affecting Nvidia (NVDA).
Although Gerra said data center trends are still "very strong," it's likely that a peak in year-over-year revenue comes in the first half of 2022 and gaming-related revenue is likely to be weak for the rest of the year.
Last week, investment firm Truist slashed price targets across the board in the semiconductor space, including Nvidia (NVDA), telling investors it has found "hard evidence of order cuts."