The investor known for his role in “The Big Short” suggested that current volatility in the AI chipmaker’s valuation may present a window for short-term gains. Michael Burry noted he was shocked by the market’s reaction to reports of CEO Jensen Huang’s personal affair, which contributed to a roughly 10% drop in the stock’s value. While Burry expressed skepticism about Nvidia’s competitive edge over the long run and warned that some GPUs may be economically depreciating in warehouses, he said the recent selloff might soon be seen by investors as a “heck of a trade.”
The downward pressure on the shares follows a rare neutral rating from Baird, which slashed its price target for Nvidia to $200 from $500. Analyst Tristan Gerra warned that hyperscaler AI spending growth could slow to 40% or less by 2027, coinciding with expectations that a potential successor to Huang would be recruited from outside the company. However, Baird’s bearish outlook remains an outlier; five of the six most recent analyst calls for the stock remain bullish, with target prices between $285 and $330.
