Nvidia heads for longest weekly losing streak since 2012
Nvidia fell 4.3% on Thursday, putting it on course for a sixth straight weekly loss, its longest since 2012, with about $1.6 trillion in market value gone since the slide began in early October.
A sixth straight weekly loss
Nvidia fell 4.3% on Thursday, leaving the stock down 11% so far this week and on course for a sixth straight weekly decline, the longest losing streak since 2012, CNBC reported. The shares have fallen 29% over the past six weeks, wiping out roughly $1.6 trillion in market value since the slide began in early October.
The drop has knocked Nvidia below Apple as the world's most valuable company, a title it held for most of the year. Reuters put the loss at $1.8 trillion over five weeks, with the stock down more than 30% from its October 6 peak.
The selling started before the scandal
The selling began before Jensen Huang's resignation. Shares dropped about 9% last week, much of it after the midterm elections, as sweeping Democratic victories and ballot measures raised the prospect of slower artificial intelligence development. Before that, the AI trade had been sliding on concern that rising interest rates would punish companies carrying heavy debt.
Nvidia itself is highly profitable, CNBC noted, but some of its biggest customers, the cloud providers known as neoclouds, rely on debt markets to fund their expansion. Huang, who co-founded Nvidia and led it for 33 years, resigned on Thursday after two extramarital affairs became public. Finance chief Colette Kress was named interim chief executive while the board searches for a full-time successor.
- Nvidia on ThursdayDown 4.3%
- Nvidia this weekDown 11%
- Six-week slideDown 29%, about $1.6 trillion lost
- Revenue expected Nov. 17$108.9 billion, up 91% from a year earlier
Analysts trim targets; earnings next
Gil Luria of D.A. Davidson cut his target for Nvidia to $200 from $300 while keeping a buy rating, saying the company faced a challenging transition over the next few months. Oppenheimer wrote that fundamentals were likely to take a back seat in the near term and warned that Huang's departure could mean a lingering overhang on the shares.
Attention now turns to Nvidia's quarterly results on Tuesday, November 17. Analysts expect revenue to rise 91% from a year earlier to $108.9 billion, according to LSEG, 18 times the figure for the same quarter in 2022, just before OpenAI launched ChatGPT. The broader market held up better: the S&P 500 sits less than 3% below its record high, Reuters noted, with the Nasdaq, S&P 500 and Dow each down 0.4% on Thursday.
