Despite a prolonged period of underperformance, analyst Jay Goldberg at Seaport Research is reinforcing his bearish stance on Nvidia (NVDA), citing a deteriorating valuation and competitive pressures in the AI semiconductor space. The firm maintains a sell rating with a 2026 price target of $450, implying a 35% downside from current levels.
- Seaport Research maintains a sell rating on NVDA with a 2026 price target of $450
- Projected data center revenue growth for NVDA to slow from 50% YoY (2024) to 20% by 2026
- Gross margin forecast declines from 75% to 70% over the next two years
- AI semiconductor market CAGR forecast reduced to 12% from 25%
- Competitive pressures from AMD and hyperscaler-designed chips highlighted as key risks
- 12-month downside potential of 35% based on current valuation and forward assumptions
Jay Goldberg, senior analyst at Seaport Research, is doubling down on his bearish view of Nvidia (NVDA), maintaining a sell rating and revising his long-term price target to $450 by 2026. This projection represents a 35% decline from NVDA’s current trading range near $700, signaling heightened caution despite the stock’s continued dominance in AI-driven semiconductor demand. Goldberg argues that Nvidia’s leadership is becoming increasingly vulnerable as competitors like AMD and custom silicon from hyperscalers intensify pressure on margins and market share. The analyst highlights a shift in the AI infrastructure landscape, pointing to rising utilization of alternative chips for inference workloads and growing investment in in-house silicon by major cloud providers. According to internal models, revenue growth for NVDA’s data center segment is expected to decelerate from 50% year-over-year in 2024 to 20% by 2026, driven by supply normalization and macroeconomic factors limiting enterprise spending. The company’s gross margin, currently at 75%, is projected to decline to 70% over the next two years due to competitive pricing and higher R&D costs. The renewed emphasis on the 2026 timeframe underscores a strategic pivot from short-term momentum to long-term sustainability. While NVDA has delivered over 200% gains since early 2023, Goldberg warns that the current valuation premium reflects excessive optimism, particularly regarding the longevity of Nvidia’s moat in generative AI. The firm’s model assumes a 12% compound annual growth rate (CAGR) for the broader AI semiconductor market, significantly below last year’s 25% forecast, reflecting reduced near-term demand certainty. This bearish thesis could influence investor behavior across tech and growth-oriented portfolios, especially those with concentrated exposure to AI-related equities. Institutions with significant NVDA holdings may reassess positioning, while semiconductor ETFs like SOXX and SMH could experience increased volatility. The divergence between Wall Street’s dominant bullish consensus and a high-conviction minority view may deepen market debate as earnings season approaches.