Nvidia Corp. (NASDAQ: NVDA), despite exceeding Wall Street expectations in its second-quarter earnings, is trading lower today.
Jim Cramer, a well-known investor, attributes the weakness of NVDA’s stock to its “priced perfection.”
He is still optimistic about the long-term prospects of the semiconductor giant.
Cramer urges caution and warns against buying shares this morning as short-term sellers might not have completed their liquidation.
Cramer believes that while Nvidia’s stock may experience further short-term weakness in the future, it will eventually recover and climb back to $150.
He shared his insights with members of the club on Thursday.
Nvidia eases Blackwell Supply Concerns
Nvidia approved a $50 billion stock-buyback program last evening, adding to the reasons to hold its shares long term.
The Nasdaq listed firm confirmed during the earnings call that Hopper architecture demand remains strong, despite customers “gearing-up to adopt Blackwell”.
NVDA also eased concerns about Blackwell’s supply by saying “we will have lots and lots”.
The company said that the anticipation for the next-generation AI chip platform was incredible. “Its production ramp is scheduled in the fourth quarter of fiscal year 2026,” it added.
Jim Cramer told long-term investors that Nvidia is the best chip company in the entire world, and it is at the center of the accelerated computing trend.
Nvidia stock may still drop by 20% in the future
Nvidia’s stock fell 3.0% on Friday, perhaps because investors are used a higher beat in terms of both the quarterly figures and the future guidance.
Shares of the multinational, based in Santa Clara, CA, may be safe as long as cloud computing giants like Google, Amazon and, of course, Microsoft, continue to talk about aggressive investments into AI infrastructure, as they did during their most recent earnings report.
Josh Koren, founder of Musketeer Capital Partners, says that NVDA could lose up to 20% or more if the CAPEX guidance starts to wane.
Koren expects this to happen in the next two-three quarters, even though Nvidia’s earnings are becoming a key indicator of economic activity like CPI and employment data.
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