By Adam Clark
Nvidia was rising early Tuesday, with the chip maker benefiting from a global rebound after the previous day's sharp selloff but also reassurances over potential delays to its next generation of chips.
Nvidia shares were up 1.2% at $101.61 in premarket trading. The stock closed down 6.4% on Tuesday.
Along with the wider market, Nvidia looked set to recoup some of Monday's losses when economic fears knocked the market. Technology stocks boosted by excitement over artificial intelligence were hit particularly hard.
However, Nvidia's gains also could be down to Wall Street's general positivity over the company's ability to overcome reported manufacturing problems that could delay the shipment of some its next-generation Blackwell chips by several months.
"Nvidia's competitive position remains sound, and we don't expect any share loss from a minor delay ...We see Nvidia as best positioned in AI, benefiting from full stack AI hardware/software solutions," wrote Oppenheimer analyst Rick Schafer in a research note.
Along with other analysts, Schafer pointed to Nvidia's ability to extend its current-generation Hopper chips to cover any delay in Blackwell shipments and the minimal risk of share loss as major technology companies continue to covet the most powerful AI chips.
Schafer reiterated an Outperform rating and $150 target price on Nvidia stock.
Among other chip makers, Advanced Micro Devices was up 1.4% in premarket trading Tuesday and Broadcom was gaining 1.5%.
Nvidia shares have risen 103% this year through to Monday's close. That compares with a 8.7% increase in the S&P 500 index and a 7.9% gain in the Nasdaq Composite over the same period.
Write to Adam Clark at adam.clark@barrons.com
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August 06, 2024 05:53 ET (09:53 GMT)
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