Nvidia (NASDAQ:NVDA) heads into its Q3 earnings with soaring expectations, but top investor James Foord warns that the company’s incredible streak of triple-digit year-over-year growth may be coming to an end. Despite projecting $32.5 billion in revenue for Q3, Foord sees signs of slowing demand and competition from other chipmakers.
Foord cites concerns over macroeconomic factors, such as the recent re-election of Donald Trump, which could impact regulations, trade, and energy costs. However, he also highlights potential upsides, including reduced regulatory pressures and more favorable financing conditions under the new administration.
The investor notes that Nvidia’s large investments in data center build-outs are being financed through debt, which could be a challenge for the company to overcome. Foord also expresses concerns about satisfying investors’ lofty projections, saying it would take a “big surprise” to please them.
Additionally, the recent misses of other industry firms, such as ASML and Applied Materials, may indicate that demand is slowing down. The net outflows from insiders and institutional investors in Q3 could be another sign that things are about to head downwards.
Despite Foord’s pessimism, Nvidia enjoys a consensus Strong Buy rating on Wall Street, with 39 Buy and 3 Hold ratings. Its 12-month average price target of $163.26 suggests approximately 15% upside from current levels.
Source: https://www.tipranks.com/news/cash-out-ahead-of-earnings-says-top-investor-about-nvidia-stock