Mizuho cuts NVIDIA stock price target to $168, cites AI growth fears

On Friday, Mizuho (NYSE:MFG) Securities adjusted its outlook on NVIDIA Corporation (NASDAQ:NVDA), reducing the price target to $168 from the previous $175. Despite the revision, Mizuho continues to recommend NVIDIA with an Outperform rating. The decision reflects a recalibration of expectations in the face of multiple compression within the artificial intelligence sector, driven by concerns over potential deceleration in growth rates. According to InvestingPro data, analyst targets for NVIDIA currently range from $130 to $220, with 27 analysts recently revising their earnings expectations upward.

The firm’s analyst pointed out that there have been no changes to NVIDIA’s earnings estimates, reinforcing confidence in the company’s performance. The price target adjustment is primarily a response to the broader market dynamics affecting companies in the AI industry. The analyst emphasized NVIDIA’s strong position, stating, "we continue to see NVDA dominating with a superior HW/SW stack as it ramps Blackwell and maintains leadership with CUDA." This confidence is supported by NVIDIA’s impressive financial metrics, including a 114.2% revenue growth and an exceptional Piotroski Score of 9, as revealed by InvestingPro’s comprehensive analysis.

NVIDIA, known for its advanced hardware and software offerings, is expected to maintain its competitive edge with the upcoming introduction of Blackwell, its next-generation GPU architecture. This is anticipated to further cement the company’s leadership in the AI and computing sectors.

The valuation multiple applied by Mizuho to arrive at the new price target is based on 31.1 times the firm’s fiscal year 2027 earnings per share estimate. This multiple reflects the current market sentiment towards AI stocks, which has been influenced by the prospect of slowing growth.

Despite the reduced price target, the Outperform rating indicates that Mizuho’s analysts believe NVIDIA will continue to outperform the market, driven by its innovative technology and strong market position. The revised target suggests that while NVIDIA is not immune to market-wide pressures, its long-term prospects remain robust.

In other recent news, NVIDIA has announced a collaboration with Microsoft (NASDAQ:MSFT) to integrate neural shading support into the DirectX platform, enhancing gaming experiences with NVIDIA GeForce RTX GPUs. The partnership aims to improve frame rates and image quality while reducing system demands. NVIDIA’s RTX Kit, now compatible with Unreal Engine 5, and the open-source platform RTX Remix have also received updates, further advancing graphics technology. In corporate developments, NVIDIA has introduced a Variable Compensation Plan for Fiscal Year 2026, linking executive pay to specific performance targets, including revenue goals. This plan is designed to align executive interests with those of shareholders. On the analyst front, BofA Securities has maintained a buy rating with a price target of $200, while Citi reiterated a buy rating with a $163 target, expressing optimism ahead of NVIDIA’s upcoming GPU Technology Conference. The conference is expected to reveal updates on NVIDIA’s Blackwell Ultra and Rubin processors, which are key to the company’s future strategies. These developments come as NVIDIA continues to navigate challenges related to AI restrictions and tariffs, with analysts noting that some risks have been mitigated.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.