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Reading:The Dean of Evaluation said NVIDIA shares could drop 31%. I have an opposition to why Deepseek can supply fuel to the new top.
Aswath Damodaran is an outstanding professor at the Stern School of Business at New York University. In particular, Damodaran specializes in evaluation, written several books on this topic and often posts his models and predictions to the public. Over the years, Damodaran is known as “Dean of Evaluation” among financial journalists and media characters.
Last week, Damodaran announced a new prediction nvidia(NASDAQ: NVDA) -The stock price falls 37% at the current level (as of February 5).
Below I will explain in detail the logic of Damodaran to explain why he demands such drops. There, I will talk about why I do not completely match his weaknesses.
So far, you will probably be familiar with the latest story of AI, or Chinese new companies. Deepseek. DeepSeek is the latest company that appeared in the AI area, claiming that it has developed a game change application for some of the costs used to build a liquor model in Openai or Anthropic.
In Damodaran’s analysis, he said, “We have changed the AI story and said,” Segence of low -end AI products, “Segents of premium products,” and “branched AI market”.
On the surface, I understand what Damodaran is doing. DeepSeek has built a similar or excellent platform to the existing AI model, and if the location of NVIDIA as a chip area is in danger, DeepSeek is less expensive.
But in the world where DeepSeek was built for much less funds than the optimal of Openai and its cohort, I still don’t see that concept for NVIDIA. The reason is that the chip wear point of Damodaran is actually commercialized.
Many of the largest customers in NVIDIA are well known as Cloud HyperScaler. Microsoft,,, alphabetand Amazon. Also, large companies like large technology giants Meta platform and Tesla It is also part of NVIDIA’s largest adoption. What is it also Many of these companies are investing a lot in internal chipware: Luxury.
The basis for this investment is that NVIDIA’s chips are not in expectations, but rather find ways to diversify their platforms and create cost -saving opportunities in the process. As more chips enter the market, these products will be somewhat commercialized anyway. In my heart, Deepseek doesn’t change the story of the chip into a product hardware product. We are strengthening ideas.
Image Source: Getty Image.
One of the areas I will admit is now a bit blurry. DeepSeek’s arrival thinks that investors are uncomfortable (but perhaps) that NVIDIA’s growth can be slowed down at a meaningful speed.
Such concerns are legitimate, but Big Tech still seems to be the first to match in front of NVIDIA’s door. According to the recent opinion of META CEO Mark Zuckerberg and Microsoft’s leadership, investment in AI infrastructure will continue in the near future.
It’s hard to accurately determine how much spending is spent for NVIDIA, but I’m sure that a leading chip manufacturer will remain at the center of the world’s best AI business in the future.
The irony is that NVIDIA’s largest customer has publicly mentioned that the largest customer of NVIDIA has maintained its capital expenditure (CAPEX) budget and still sold out, but it is openly mentioned.
Honestly, it’s not surprised if NVIDIA stocks continue to decrease until the company reports income on February 26. Until then, investors and analysts think that they will have enough details to know how AI spending will look. Almost short and long horizon.
What I oppose is that the company’s leadership will promote one point during the 4/4 call of NVIDIA. The demand for chips, including the latest most expensive architecture, is powerful and must continue for a while.
Therefore, you will not be surprised to see NVIDIA’s stocks starting to return to the epic way. Now I think the DIP of NVIDIA stocks will be an amazing purchase opportunity and the stock will be much higher in today’s position.
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