Some stocks ended this week with a serious bang after the July 4th holiday. Others, however, exited with a whimper. Unfortunately for its investors, NVIDIA (NVDA -2.85%) was one of the latter. The specialty tech company's shares traded marginally lower on the day due largely to an analyst's price-target cut, booking a slightly deeper loss than the S&P 500 index.
Tigress Financial Partners' Ivan Feinseth was the person doing the cutting. He now believes NVIDIA stock is worth $310 per share, down quite some distance from his previous estimation of $410. Crucially, however, he is maintaining his buy recommendation on the company.
He also took pains to point out that his move is based on what he terms a "rerating of valuation" on the specialty tech stock. NVIDIA remains relatively popular among certain investors despite notable drops in the prices of other titles in the sector, while nervous investors sell out in favor of defensive stocks considered better plays in a potentially declining economy.
Feinseth is still very bullish on NVIDIA"s business. In his research note detailing the price-target cut, he wrote that the company's "leadership position in data centers, autonomous technology, and AI will continue to drive accelerating growth." He also pointed out that NVIDIA remains very much on the cutting edge of processor technology.
So at the end of the day, despite that 24% chop to NVIDIA's target price, the prognosticator still has a very sunny view of the company's future. It seems investors paid more attention to that than the reduced price level.