NVIDIA (NASDAQ:NVDA) Stock Price Down 2.3% – Here’s Why

NVIDIA Corporation (NASDAQ:NVDA)’s share price was down 2.3% on Tuesday . The stock traded as low as $218.69 and last traded at $219.74. Approximately 102,507,493 shares changed hands during mid-day trading, a decline of 36% from the average daily volume of 159,941,875 shares. The stock had previously closed at $225.01.

Key Headlines Impacting NVIDIA

Here are the key news stories impacting NVIDIA this week:

• Positive Sentiment: Analysts see substantial upside. Bank of America reiterated a bullish view, arguing that NVIDIA’s valuation is compelling relative to free cash flow and that increased share repurchases could support roughly 55% upside. The broader analyst consensus indicates approximately 35% potential appreciation, although estimates are already demanding. Here’s the case for Nvidia’s stock to climb 55% from here, according to BofA
• Positive Sentiment: Ohio data-center agreement expands NVIDIA’s addressable market. NVIDIA will provide financing support and compute for an OpenAI data center in Ohio, potentially guaranteeing up to $105 billion in lease payments. The 8-gigawatt campus is expected to use NVIDIA systems exclusively, while NVIDIA is also investing $1.5 billion in developer SB Energy. The arrangement could accelerate chip demand and deepen NVIDIA’s role in AI infrastructure financing. Nvidia backs financing for OpenAI data center in Ohio
• Positive Sentiment: AI demand remains broadening. LG Electronics plans to use NVIDIA’s Omniverse, Cosmos and Isaac platforms to train robots, while HIVE Digital Technologies is deploying 2,016 NVIDIA Blackwell Ultra GPUs under a five-year, approximately $350 million cloud contract. These deals illustrate potential growth beyond traditional hyperscaler GPU purchases. LG Electronics Partners with NVIDIA to Accelerate AI-Powered Robotics Development
• Neutral Sentiment: Next week’s earnings are the key catalyst. NVIDIA reports fiscal second-quarter results on August 26. Investors are expected to focus less on another likely beat and more on fiscal third-quarter guidance, Blackwell demand, data-center growth, gross margin near 75%, incremental profit generation and the transition to Rubin. A routine beat may not be sufficient without upward revisions. Nvidia’s Q2 Preview
• Negative Sentiment: Financing concerns are weighing on sentiment. Critics describe NVIDIA’s guarantees, investments and broader $500 billion financing initiative as a potentially circular structure in which NVIDIA helps fund data centers that purchase its chips. Private-credit exposure, customer creditworthiness and the possibility of an AI spending bubble could increase future financial risk. Nvidia’s AI moat is shifting from chips to capital
• Negative Sentiment: Macro pressure is affecting the entire chip group. Higher Treasury yields are reducing the appeal of richly valued technology stocks and prompting a broader semiconductor pullback. NVIDIA’s elevated beta makes it particularly sensitive to changes in rates and risk appetite.

Analysts Set New Price Targets

Several equities research analysts recently commented on the stock. BMO Capital Markets restated a “buy” rating on shares of NVIDIA in a research report on Tuesday. DA Davidson reiterated a “buy” rating and set a $300.00 price objective on shares of NVIDIA in a research report on Monday, June 1st. Needham & Company LLC reissued a “buy” rating and set a $270.00 target price on shares of NVIDIA in a research note on Tuesday, June 2nd. BNP Paribas Exane increased their target price on NVIDIA from $270.00 to $285.00 and gave the company an “outperform” rating in a report on Thursday, May 21st. Finally, President Capital raised their target price on NVIDIA from $280.00 to $295.00 and gave the stock a “buy” rating in a research report on Thursday, May 21st. Three analysts have rated the stock with a Strong Buy rating, forty-nine have given a Buy rating and two have issued a Hold rating to the stock. Based on data from MarketBeat, the stock has a consensus rating of “Buy” and a consensus target price of $305.94.

NVIDIA Trading Down 2.4%

The company has a debt-to-equity ratio of 0.04, a quick ratio of 2.85 and a current ratio of 3.44. The stock has a market cap of $5.32 trillion, a price-to-earnings ratio of 33.63, a price-to-earnings-growth ratio of 0.44 and a beta of 2.23. The company’s 50 day simple moving average is $206.47 and its two-hundred day simple moving average is $198.85.

NVIDIA (NASDAQ:NVDA) last issued its earnings results on Wednesday, May 20th. The computer hardware maker reported $1.87 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.76 by $0.11. NVIDIA had a net margin of 62.97% and a return on equity of 96.94%. The company had revenue of $81.61 billion during the quarter, compared to analyst estimates of $78.42 billion. During the same quarter last year, the business posted $0.81 EPS. The company’s revenue for the quarter was up 85.2% on a year-over-year basis. Research analysts expect that NVIDIA Corporation will post 8.79 EPS for the current fiscal year.

NVIDIA Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, June 26th. Investors of record on Thursday, June 4th were given a dividend of $0.25 per share. The ex-dividend date of this dividend was Thursday, June 4th. This is a positive change from NVIDIA’s previous quarterly dividend of $0.01. This represents a $1.00 dividend on an annualized basis and a yield of 0.5%. NVIDIA’s payout ratio is 15.31%.

NVIDIA announced that its board has initiated a share repurchase plan on Wednesday, May 20th that permits the company to buyback $80.00 billion in shares. This buyback authorization permits the computer hardware maker to reacquire up to 1.5% of its shares through open market purchases. Shares buyback plans are typically an indication that the company’s management believes its shares are undervalued.

Insider Buying and Selling at NVIDIA

In other NVIDIA news, Director John Dabiri sold 625 shares of the company’s stock in a transaction dated Wednesday, May 27th. The stock was sold at an average price of $214.00, for a total value of $133,750.00. Following the transaction, the director directly owned 14,163 shares of the company’s stock, valued at $3,030,882. This represents a 4.23% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Stephen C. Neal sold 15,500 shares of the firm’s stock in a transaction dated Wednesday, June 3rd. The stock was sold at an average price of $215.73, for a total value of $3,343,815.00. Following the sale, the director directly owned 116,135 shares of the company’s stock, valued at $25,053,803.55. This trade represents a 11.77% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 1,901,125 shares of company stock worth $410,583,015 over the last 90 days. 3.94% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On NVIDIA

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Livforsakringsbolaget Skandia Omsesidigt lifted its stake in shares of NVIDIA by 0.7% in the 2nd quarter. Livforsakringsbolaget Skandia Omsesidigt now owns 1,347,275 shares of the computer hardware maker’s stock valued at $269,132,000 after purchasing an additional 9,900 shares during the last quarter. Rakuten Investment Management Inc. increased its position in NVIDIA by 12.4% during the second quarter. Rakuten Investment Management Inc. now owns 4,767,757 shares of the computer hardware maker’s stock worth $929,570,000 after buying an additional 527,365 shares during the last quarter. RIHO Partners LLC increased its position in NVIDIA by 32.3% during the second quarter. RIHO Partners LLC now owns 86,461 shares of the computer hardware maker’s stock worth $17,300,000 after buying an additional 21,127 shares during the last quarter. Denver PWM LLC raised its holdings in NVIDIA by 26.2% during the second quarter. Denver PWM LLC now owns 9,780 shares of the computer hardware maker’s stock valued at $1,957,000 after buying an additional 2,032 shares in the last quarter. Finally, Orion Capital Management LLC raised its holdings in NVIDIA by 4.0% during the second quarter. Orion Capital Management LLC now owns 22,346 shares of the computer hardware maker’s stock valued at $4,471,000 after buying an additional 850 shares in the last quarter. Institutional investors own 65.27% of the company’s stock.

NVIDIA Company Profile

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.