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.

Seaport's Rare "Sell" Rating Challenges Wall Street Consensus

Driven by the AI boom, NVIDIA has become an investor favorite, with the vast majority of analysts optimistic about its prospects. However, Jay Goldberg of Seaport Research Partners bucked the trend, issuing a report on April 30 that unusually gave NVIDIA a "sell" rating, setting a target price of $100, below the closing price of $108.92 that day.

Goldberg pointed out that although NVIDIA is a major beneficiary of the current AI infrastructure wave, its growth prospects have been fully understood and reflected in the stock price. He believes that AI capital expenditure may decelerate in the coming years, especially after 2026, when the return on AI investment will face more scrutiny.

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In the report, Goldberg emphasized that while AI spending may remain strong in 2025, it could slow down starting in 2026. He noted, "AI may not be a bubble, but its real benefits may take years to materialize." This view aligns with some market observers, such as former JPMorgan strategist Marko Kolanovic, who also warned that if the AI capital expenditure cycle slows, companies like NVIDIA will bear the brunt.

Additionally, Goldberg pointed out that NVIDIA's largest customer base—including hyperscale cloud service providers like Amazon, Microsoft, and Google—is actively developing their own AI chips, which could weaken NVIDIA's future market share and order predictability.

Technical Deployment Challenges and Supply Chain Pressure

Beyond market demand concerns, Goldberg also highlighted the technical challenges in deploying NVIDIA products. He stated that deploying NVIDIA's latest AI systems is far more complex than traditional data centers, with the overall supply chain facing multiple challenges such as cooling, configuration, and collaboration, which may limit its expansion speed and customer adoption willingness.

He wrote in the report, "Our research shows that deploying NVIDIA systems requires extremely high technical integration skills, which is a major barrier for many companies."

Geopolitical Tensions Rise: Uncertain Prospects in the Chinese Market

Goldberg also listed geopolitical tensions as a major challenge facing NVIDIA. As the U.S. government strengthens restrictions on AI chip exports, NVIDIA's operational scope in the Chinese market is being squeezed. According to AOL reports, the U.S. has recently banned NVIDIA from exporting its specially designed AI chips to China, further weakening its revenue sources in China.

NVIDIA CEO Jensen Huang recently admitted at a forum in Washington that China is not lagging in the AI field and is highly competitive. He pointed out, "China is right behind us, and we are very, very close." This also reflects that local Chinese competitors (such as Huawei) may seize the opportunity to capture market share, posing a potential threat to NVIDIA.

Contradicting Mainstream Wall Street Views

Goldberg's pessimistic assessment runs counter to mainstream Wall Street views. According to FactSet data, no other analysts currently give NVIDIA a "sell" rating, with an average target price of $161.59. Among analysts tracked by Bloomberg, 88% recommend "buy," 11% recommend "hold," and Seaport is the only institution to give a "sell" rating.

Data from the Koyfin platform also shows that among the 62 analysts tracking NVIDIA, 12 give a "strong buy," 43 give a "buy," 7 recommend "hold," and no one recommends "sell." Goldberg's $100 target price is also the lowest target price set for NVIDIA in the market.

Stock Price Reaction and Market Dynamics

On the day Seaport released the report, NVIDIA's stock price fell slightly by 0.1% to $108.92, but rebounded 3.7% after hours due to Meta raising its capital expenditure expectations. Nevertheless, NVIDIA's stock price has fallen more than 20% since the beginning of the year, underperforming the Philadelphia Semiconductor Index.

Additionally, Goldberg also issued ratings for other semiconductor companies. He gave Intel a "sell" rating, believing that the company is being eaten away by competitors in both the PC and data center markets and lacks a clear AI strategy. Conversely, he gave Broadcom a "buy" rating, believing that the company is poised to benefit from the trend of hyperscale customers making their own chips, and noted that its potential remains underappreciated by the market.

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

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