Bernstein warns against bottom-fishing Nvidia for now, downgrades rating to "Market Perform".

BlockBeats news, November 12 - Wall Street investment bank Bernstein downgraded Nvidia's rating from "Outperform" to "Market Perform," and cut its target price from $400 to $200. Analyst Stacy A. Rasgon noted that the adjustment is not due to a deterioration in Nvidia's fundamentals, but rather the ongoing fallout from scandals related to Jensen Huang, making it difficult to assess the company's management prospects and potential business risks.

Bernstein believes that although Nvidia's stock price has fallen to highly attractive valuation levels and the company's data center business growth prospects remain strong, the current negative news may not have fully played out. If Jensen Huang were to leave, the choice of successor and management transition would bring uncertainty, along with potential government investigations and risks related to changes in supply chain strategic investments, backstop commitments, and guarantee arrangements.

Rasgon described the current situation as "finding a cockroach in the kitchen usually means there's more than two," believing that more internal allegations and subsequent risks may continue to emerge. Bernstein therefore advises investors not to bottom-fish Nvidia for now and to stay on the sidelines.