Analyst Jay Goldberg: Advanced Micro Devices and Broadcom could become the new favorites in AI chip investments, while Nvidia is facing pressure on market share and valuation.

Taiwan • Business • 05/01 06:00
Analyst Jay Goldberg: Advanced Micro Devices and Broadcom could become the new favorites in AI chip investments, while Nvidia is facing pressure on market share and valuation.

Seaport Research Partners analyst Jay Goldberg has rated NVIDIA as a "sell" with a target price of $100 amidst a booming AI chip market, noting that its valuation already aligns with market expectations and faces pressure from customers creating their own chips. On the other hand, he is optimistic about AMD and Broadcom, giving them "buy" ratings with target prices of $100 and $230, respectively, due to their strategic moves and strong execution in the AI and data center markets, potentially making them more attractive investments.

Key Updates

05/02 00:31

On May 1, 2025, the U.S. stock market ended the day higher: Technology stocks led the rally, as earnings reports from Microsoft and Meta lifted the three major indexes.

On May 1, 2025, the U.S. stock market saw a broad increase as Microsoft and Meta Platforms reported better-than-expected earnings. The Dow Jones Industrial Average, the S&P 500 Index, and the Nasdaq Composite Index all closed higher, extending their rebound. Technology stocks stood out, with strong results from Microsoft and Meta easing worries about a slowdown in AI industry growth and lifting other tech stocks. Market sentiment was also lifted by a relaxation in trade tensions.

05/01 23:02

Microsoft and Meta's earnings reports beat expectations, lifting major U.S. stock indices on May 1, 2025.

On May 1, 2025, the U.S. stock market saw gains across the board as Microsoft and Meta reported better-than-expected earnings, easing concerns over AI investment returns and the economic outlook. The Dow Jones Industrial Average rose 83.60 points, the S&P 500 rose 35.08 points, the Nasdaq jumped 264.40 points, and the Philadelphia Semiconductor Index rose 17.58 points. The strong performance of Microsoft and Meta led the major stock indices to their eighth consecutive day of gains.

05/01 15:03

On May 1, U.S. stocks rebounded strongly as earnings reports from tech giants lifted the market, with tech giants Microsoft and Meta leading the charge.

On May 1, 2025, U.S. stocks surged across the board as Microsoft and Meta's earnings reports exceeded expectations, with Microsoft's stock price soaring more than 9% intraday and Meta climbing over 6%. TSMC ADR and Nvidia shares also advanced, as the Philadelphia Semiconductor Index rose 1.44%. However, data from the U.S. Department of Labor showed that initial jobless claims unexpectedly rose to 241,000, indicating pressure in the labor market.

05/01 07:02

NVIDIA Uncommonly Rated as Sell by Analyst Jay Goldberg: Slowdown in AI Spending and China-US Geopolitical Risks Pose Challenges

NVIDIA, a US-based AI chip company, was recently rated as a "sell" by Seaport Research analyst Jay Goldberg, a rare occurrence, marking the first time in nearly two years. Goldberg pointed out that AI spending may slow down in the coming years, increased geopolitical tensions between the US and China, and the technical complexity of NVIDIA's system deployments being higher than that of traditional data centers pose challenges to the company's prospects. He lowered NVIDIA's target stock price to $100, below the Wall Street average target price of $161.59, making Seaport Research the only institution with a pessimistic view on the stock.

05/01 06:31

The U.S. stock market dropped sharply due to the triple whammy of GDP contraction, employment slowdown, and inflation pressures.

On April 30, 2025, the U.S. stock market saw significant volatility due to a 0.3% contraction in first-quarter GDP, slowing job growth, and ongoing inflationary pressures. Major indices dropped sharply in the morning session but rebounded in the afternoon after news of U.S.-China trade talks. The energy, steel, and financial sectors were the biggest losers, highlighting worries about an economic slowdown. Even though the market recovered by the end of the day, April's overall performance was poor, with the S&P 500 and Dow Jones indices falling for three straight months.

05/01 06:00

Analyst Jay Goldberg: Advanced Micro Devices and Broadcom could become the new favorites in AI chip investments, while Nvidia is facing pressure on market share and valuation.

Seaport Research Partners analyst Jay Goldberg has rated NVIDIA as a "sell" with a target price of $100 amidst a booming AI chip market, noting that its valuation already aligns with market expectations and faces pressure from customers creating their own chips. On the other hand, he is optimistic about AMD and Broadcom, giving them "buy" ratings with target prices of $100 and $230, respectively, due to their strategic moves and strong execution in the AI and data center markets, potentially making them more attractive investments.

04/30 22:31

Microsoft's Third Quarter 2025 Financial Report Surpasses Expectations: Cloud Services Drive Revenue to Record Highs, Stock Price Jumps Over 6% in After-Hours Trading

On April 30, 2025, Microsoft announced its financial results for the third quarter of the fiscal year 2025, reporting revenue of $70.07 billion, an increase of 13% year-over-year, and a net profit of $25.8 billion, which is an 18% increase year-over-year, both figures exceeded expectations. The cloud and AI sectors experienced strong growth, with Azure's revenue growing by 33% year-over-year. Consequently, Microsoft's stock price increased by over 6% in after-hours trading.

04/30 18:00

Eurozone's GDP increased by 0.4% in the first quarter, exceeding expectations, leading to a rise in European stocks; U.S. economy shrinks unexpectedly by 0.3%.

In the first quarter of 2025, the Eurozone's GDP increased by 0.4% from the previous quarter, exceeding expectations and boosting European stock markets. The U.S. GDP contracted by an annualized 0.3%, marking the first decline in three years, due to an increase in imports and a decrease in government spending. The Eurozone economy continued to grow with support from multiple countries, while the U.S. economy was under pressure due to a widening trade deficit and sluggish job growth.

04/30 15:30

The U.S. GDP shrinkage in the first quarter has led to stock market volatility, and 360,000 Taiwanese mothers are facing the risk of depression.

In the first quarter of 2025, the US GDP declined at an annualized rate of 0.3%, missing the expected 0.4% growth, causing a drop in the three major US stock indices. The Dow Jones dropped 237 points, the S&P 500 fell 61 points, and the Nasdaq plunged 361 points. A survey in Taiwan indicates that about 360,000 mothers exhibit signs of depression, highlighting the pressures from family and society. This article examines US economic data and market reactions, connecting them to the current situation of maternal stress in Taiwan, offering a comprehensive view of the intersection between global economics and mental health.

04/30 13:03

The 'Big Seven' U.S. Tech Giants Stock Rebound Falters: Profit Growth Slows for Companies Such as Microsoft

At the beginning of 2025, the "Seven Giants," a group of American tech giants, saw a rebound, but the latest financial reports show slower profit growth, rising valuation pressure, and a blow to market confidence. Microsoft's earnings report exceeded expectations, but its stock price fell due to a decline in free cash flow margin and uncertainty about AI investment returns. The "Seven Giants" overall profit growth rate fell from 52% in 2024 to 21.4% in 2025. Investors' risk appetites have shifted, with funds moving into gold and other sectors, and analysts are split on their ratings of the "Seven Giants."

Nvidia: Valuation Already Reflects Positives, Faces Challenges from In-House Chip Development

As a leader in the AI chip market, Nvidia has long benefited from the explosive demand for generative AI and large language models. However, Seaport analyst Goldberg points out that Nvidia's stock price has fully reflected its leading position in the AI boom and warns that future demand may decrease. He rates Nvidia's stock as a "sell," setting a target price of $100, significantly lower than the current market price.

Goldberg specifically notes that the high deployment cost of Nvidia's high-end GPUs and the increasing demands from customers for returns on AI investments may limit its future growth potential. Additionally, as hyperscalers like Meta and Google accelerate the development of their own AI chips, Nvidia's market share is facing erosion. For example, Meta's recently launched MTIA chip has begun replacing Nvidia GPUs in some servers and plans to expand to AI training uses.

Broadcom: AI Custom Chip Driver, Potential Not Fully Valued by the Market

Unlike Nvidia's high profile, Broadcom's role in the AI field is more low-key but crucial. Goldberg rates Broadcom as a "buy," with a target price of $230, believing that its ability to assist tech giants in developing custom chips is the core driver of its future growth.

Broadcom currently provides custom chip design and manufacturing services for tech giants like Google, Apple, and Meta, with these chips mostly used for AI inference and data center computing. Goldberg points out that when Nvidia loses market share, it is often because these customers choose to design their own chips, and Broadcom is the biggest beneficiary of this trend.

Moreover, Broadcom's business structure is diverse, including stable revenue sources such as network chips, storage controllers, and enterprise software, in addition to AI chips. This gives it stronger risk resistance amid AI market fluctuations. Although Broadcom's stock price fell after reaching a $1 trillion market cap in early 2025, analysts believe its AI potential is not yet fully reflected in its stock price.

Advanced Micro Devices (AMD): Steady Execution and Data Center Market Share Growth Are Key

Advanced Micro Devices (AMD) also received a "buy" rating from Seaport, with a target price of $100. Goldberg states that although AMD's market share in the AI chip market is still far behind Nvidia, its continuous encroachment on Intel in the data center and PC markets demonstrates its execution strength and product competitiveness.

AMD is expected to launch the MI350 GPU series in the second half of 2025, which is anticipated to improve AI inference performance by 35 times compared to the previous generation. Although this series has not yet been released, Goldberg believes its product roadmap is clear and execution progress is steady, making it a key focus for investors.

Additionally, AMD is gradually expanding its collaboration with cloud service providers and continues to capture Intel's market share in the server CPU market. Seaport points out that although AMD's AI business is still in its early stages, its overall business performance is stable, with long-term growth potential.

AI Chip Market Competition Intensifies, In-House Development Becomes New Trend

Goldberg's report also reflects that the AI chip market is entering a new phase. In recent years, Nvidia has dominated the market due to its GPUs' strong performance in AI training and inference. However, as AI applications shift from training to inference and companies demand more in terms of cost and performance, more tech companies are choosing to develop their own chips to reduce reliance on a single supplier.

This trend poses a challenge to Nvidia but also creates opportunities for companies like Broadcom that provide custom chip solutions. Meanwhile, companies like AMD, with a complete product line and stable execution, are also poised to benefit from the expansion of data centers and AI applications.

References

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