Nvidia’s stock closed at a record high on Monday, its first since November, before plummeting $220 billion in market capitalization on Tuesday. The sudden drop has left investors questioning whether the company will continue to lead the bull market.
In a packed presentation at CES, CEO Jensen Huang outlined Nvidia’s vision for the “era of physical AI,” including its partnership with major automakers like Toyota and Volvo. He predicted that artificial intelligence would only begin to materialize in physical systems such as its Cosmos platform, and that Nvidia powers all autonomous vehicles.
However, investor enthusiasm quickly turned to skepticism after the opening bell on Tuesday, resulting in a sharp sell-off. This trend is reminiscent of previous instances where Nvidia’s stock rose rapidly but then fell sharply, including a 13% drop following its November earnings release.
Despite this volatility, some analysts remain bullish on Nvidia. Paul Meeks, chief investment officer at Harvest Portfolio Management, stated that the company will likely continue to grow and potentially reach a $4 trillion valuation in the next couple of years. However, he warned that investors should wait for a slowdown in Nvidia’s growth rate before selling.
With its innovative technology and partnerships with major automakers, Nvidia is poised to play a significant role in the development of autonomous vehicles and other physical AI systems. While the recent stock drop may have been a shock, it is unlikely to deter long-term investors from holding onto their shares.
Source: https://finance.yahoo.com/news/why-nvidia-rug-pull-doesnt-faze-us-stock-market-bulls-morning-brief-105820262.html