Nvidia (NASDAQ: NVDA) remains a dominant player in the tech world, but recent developments have sparked concerns among investors.
DeepSeek, a new chatbot that delivers results similar to top AI models while using far less computing power, has the potential to impact demand for Nvidia’s high-performance hardware.
At the same time, the looming threat of a global trade war and proposed 100% tariffs on imported semiconductors add more uncertainty to Nvidia’s future.
Despite these challenges, top investor James Foord, who ranks in the top 4% of TipRanks’ stock professionals, sees an opportunity in Nvidia’s stock.
Foord has a strong track record and believes that buying Nvidia shares at around $90-$100 before Q4 earnings could be a strategic move.
DeepSeek and the Tariff Threat: Risks or Opportunities?
While Foord acknowledges the risks posed by DeepSeek and the potential trade disruptions, he doesn’t believe these factors will have as severe an impact as some investors fear.
He explains the Jevons paradox, which suggests that when a resource becomes cheaper, its use actually increases. Foord believes this will apply to AI hardware, as more affordable AI applications could lead to widespread use by millions of companies, which would benefit Nvidia.
As for the trade tariffs, Foord is confident in Nvidia’s pricing power, believing the company can pass along higher costs to customers without hurting its margins. He also emphasizes Nvidia’s strong leadership and its industry-leading CUDA software, which helps maintain its market dominance.
A Strong Buy with Significant Potential Upside
Despite the market’s short-term volatility, Foord rates Nvidia stock as a Strong Buy, with hopes of purchasing shares around $100. Wall Street shares a similar view, with 37 Buy ratings and just 3 Holds for Nvidia. The 12-month average price target of $179.81 suggests a potential 51% upside in the next year.
With Nvidia’s leadership, innovative technology, and strategic positioning, Foord remains optimistic about the company’s long-term prospects, even amid challenges in the market.