Daily Morning News

Nvidia Stock Downgraded Amid Valuation Concerns Despite 154% Rally

Nvidia's stock receives a downgrade from New Street Research analyst Pierre Ferragu after a 154% rally this year, citing valuation concerns and uncertainty beyond 2025.

Nvidia Corp. has experienced an extraordinary 154% surge in its stock value this year, following a 240% gain in 2023. However, according to Pierre Ferragu, an analyst at New Street Research, the rally may have reached its peak. Ferragu downgraded Nvidia's stock from a buy rating to a neutral rating, suggesting the stock is now "fully valued."

Ferragu cited concerns over the stock's valuation and expressed doubt about further significant gains beyond 2025. Despite Nvidia's impressive performance, its shares fell by 1.9% during Friday's trading session, in contrast to the Nasdaq 100 Index, which gained 1% on the same day.

Ferragu stated that any additional upsides would depend on a "bull case" scenario where the outlook beyond 2025 improves significantly, a scenario in which he lacks conviction.