Aswath Damodaran is a creative professor at the New York University School of Business. In particular, Damodara specializes in evaluation by writing several books on the topic and often publishing its models and predictions to the public. Over the years, the Damodara has become known as the “Dean of Appreciation” of Financial Journalists and Media Personalities.
The Damodara published a new prediction last week Nvidia(NASDAQ: NVDA) – Calling a 37% decline in the price of shares from current levels (as of February 5).
Below I am going to present a detail of the logic of the Damodan to explain why he calls such a decline. From there I will give my assumed, why I am not fully equal to his forecast for his bear.
So far you are probably familiar with the newly spoken point of AI, particularly a Chinese starting title Rearing giftingA number of Deepseek is the latest company to appear in AI Realm, which claims to have changed game-changing projects for some of the costs used to build the main models of Openai or Anthropic.
In the analysis of the Deepseek, it says that Deepseek has “changed the history of AI”, which will “create a bifurated AI market, then a section of low-quality AI products and high-quality competitive.
On the surface, I understand what the Damodaran achieves. If (“If” if “if”) Deepseek has built a platform, or exceeds the existing AI models, it did it with less expensive infrastructure, nvidia’s position as King of the chip region will appear.
For me, the above argument is still more theory than everything. It seems that more stories are published every hour about Deepseek. Many of them are now beginning funded much more than more than $ 6 million is requiredA number if this is the case, NVIDIA is less worried.
But in a world where the deeper was built much less than funding compared to Openai and his groups, I still don’t see anything bad for Nvdia. The reason is that in fact a line is the point of the Damodanet point, becoming a product.
It is now known that many of the largest customers of NVIDIA include clouds of clouds such as Microsoft:To be in style Alphabetand ContricolativeA number of more, large technological giants such as Meta Platforms: aeration of Visitation Also are one of the largest adopts of NVIDIA. What is? too It is known that many of these companies are greatly investing in the internal Chipware and are working with a lower price suppliers, for example, for example. Advanced micro devicesA number
This investment is not that NVIDIA chips are waiting for expectations, but because these businesses are trying to diversify their own platforms and maintain costs in the process. Because more chips enter the market, these products will be the same amount of goods. In my opinion, Deepseek does not change the history of chips, becoming a commodity hardware, it strengthens the idea.
Image source: Getty Images.
A sector I will consider is a little distraction right now, the NVIDIA’s growth trajectory. I think that Deepseek’s arrival makes investors to observe the uncomfortable (but potential) idea that NVIDIA growth can slow down in a meaningful PACE one day.
Although such concerns are legal, large technologies are primarily presented for the door of NVIDIA. Meta Ceo Mark Zuckerberg’s latest comments, as well as Microsoft’s comments, both show that the introduction of AI infrastructure will continue for a visible future.
It is difficult to determine how much they are meant to NVIDIA for those expenses, but I am very sure that the leading manufacturer of chips will remain for the highest business of the central world in the future.
What is the irman that even the largest NVIDIA customers publicly stated that their capital expenditures (CAPEX) remain stable, the shares are still sold yet.
In all sincerity, I would not be surprised if the stock of NVIDIA continues until the company will earn on February 26 that investors can signal both close and long-term horizons.
My counterpart is that during the fourth quarter of NVIDIA, the company’s management will be one point above one point.
As such, I would not be surprised that the stock of NVIDIA begins to turn around an epic manner. I see dips in NVIDIA shares so far, as incredible shopping and I think the stock will be much higher where it is today.
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