Will Nvidia Stock Go To $100?
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Open your 401(k) app this morning and the index fund line probably looks calm. The Nvidia line doesn’t. Nvidia traded at $155.90 premarket Thursday (8:52 am ET), down 10.3%, as the company announced that CEO Jensen Huang had resigned, effective immediately, a day after the Wall Street Journal reported its board was preparing to oust him. It peaked at $239.24 on Oct 6, so it is already down 35%; $100 is another 36% lower.
The board opened an independent investigation on Nov 8, after reports that Huang had been the target of a foreign intelligence effort; he acknowledged a relationship with an executive reportedly suspected of spying for China. The board said it had no reason to believe company secrets were compromised. Now finance chief Colette Kress is interim CEO while the board searches for a permanent one.
Here is what is new. Since the Nov 6 close Nvidia is down 16.5%, while AMD is up 26.4%, Broadcom 20.6% and the S&P 500 2.5%. In 13 of Nvidia’s 14 earlier 15%-plus weeks since 2003, the S&P fell too, by a median 3.2%. This week it rose.
That split hides inside most portfolios. For families with seven figures invested, Nvidia sits in index funds, tech funds and AI funds at once. Do you know how much of your money rides on one company? A Trefis partner firm can add it up with you in a free 15-minute call.
| Stock | Since Nov 6 | Nov 12 premarket |
|---|---|---|
| Nvidia | −16.5% | −10.3% |
| AMD | +26.4% | +2.7% |
| Broadcom | +20.6% | +2.6% |
| Chip ETF (SMH) | +5.5% | −3.5% |
| S&P 500 (SPY) | +2.5% | −0.8% |
Nov 6 close to Nov 12 premarket, 8:52 am ET (Intrinio via Trefis).
What Would Have To Break For $100?
A chain of five links, each with a number to watch:
- Who runs Nvidia. Huang is out as CEO and director, and the release names no continuing role for him. Kress runs the company until the board picks a permanent CEO from inside or outside; the length of that search is the number to watch.
- The product pipeline. Near term, maybe no impact: new chair Harvey Jones says operations, customer commitments and the product roadmap continue without interruption. The risk is the bets beyond today’s roadmap, where a founder matters most.
- Sales. Analysts expect revenue of $410 billion this fiscal year and $694 billion next, up 69%. Nvidia reports on Nov 17.
- Deals. The next multiyear cloud orders are the tell; a hesitant buyer now has alternatives.
- Who steps up. Since Nov 6, AMD is up 26.4%, Broadcom 20.6%, Arista 12.7% and Intel 6.8%. On past Nvidia-only drops, these rivals fell with it (median −1.7% that day); on Nov 9 they rose a median 8.9%. Full lists: the winners and the losers.
The floor. If every link breaks, $100 is inside Nvidia’s record: three of its six falls of 40% or more since 2003 went past the 58% from peak that $100 implies (2004 −65%, 2007-08 −85%, 2021-22 −66%). It would also be about 11 times this year’s estimated earnings ($9.29 a share) and 6 times next year’s ($15.81). More in Nvidia Stock To $129?
What If Nothing Lasts?
The other path: the hand-off to Kress holds, orders hold, the stock reverts. Nvidia has had 41 days since 2003 when it fell 5% or more while the S&P held steady (down less than 0.5%, or up), Tuesday among them. After the 40 earlier ones, its median return was +2.3% a month later and +10.2% three months later, and it was back above the pre-drop close within three months 32 times. After its 14 earlier 15%-plus weeks, the 12-month median was +55.0%, though the typical path first fell another 17.0%, about $129 from here. Six months after past CEO exits: Intel −13.7%, McDonald’s −6.4%, HP +13.8%.
How Much Would The S&P Fall?
At $155.90, Nvidia is worth about $3.76 trillion, and it was 6.6% of the S&P 500 fund SPY at Tuesday’s close. A further 36% fall, with nothing else moving, takes about 2% off the S&P 500. After past 15%-plus Nvidia weeks, the S&P’s low in the next three months was a median 10.0% below that week’s close, with market-wide selling. Not this one, yet.
Is This A Buying Opportunity?
Only with a plan. Keep Nvidia inside a set size band and add only at a price written down in advance; $129 is a stress number, not a forecast. Watch: the CEO search and Nov 17.
What Should You Ask Next?
- Who wins while Nvidia changes CEOs: AMD or Broadcom?
- How much Nvidia do you own through index funds?
Does Your Portfolio Depend On One CEO?
Nvidia is about 6% of the S&P 500 and often more of tech funds. For families with seven figures invested, a count of how much rides on one company and one CEO takes a free 15-minute call with a Trefis partner firm.
For questions about this article or underlying research, email help@trefis.com.