Needham & Company Downgrades NVIDIA (NVDA) to Hold on Valuation

Needham & Company downgraded NVIDIA (NASDAQ: NVDA) from Buy to Hold on valuation.

Analyst Rajvindra Gill commented, "We are downgrading NVDA to Hold from Buy primarily on valuation. We believe our investment thesis has largely played out and the stock price has reacted accordingly, increasing 63% since 8/7/14 (vs up ~8.5% for the S&P 500). We upgraded NVDA to Buy in the first week of Aug 2014. NVDA has transformed itself into a platform business and ceased investing in the modem/application processor market, a wise decision, in our view. The stock looks fairly valued at current levels, near its two-year peak P/E at 21.8x our CY17 ests. Moreover, we have yet to see tangible evidence that NVDA can replace the INTC royalty payments, and we believe the current stock price is discounting the "core NVDA" earnings. We await tangible signs that the the licensing business is being replaced before becoming more constructive on the name."

For an analyst ratings summary and ratings history on NVIDIA click here. For more ratings news on NVIDIA click here.

Shares of NVIDIA closed at $28.70 yesterday.

You May Also Be Interested In

• EasyJet Plc. (EZJ:LN) (ESYJY) PT Raised to GBP750 at BofA Securities
• Sherwin-Williams (SHW) PT Lowered to $350 at Evercore ISI
• Goldman Sachs First Take on Netflix (NFLX): 'We expect the market to have a muted reaction'