NVIDIA falls 27% after Huang exit as $515 target survives

By Nathan Brooks

NVIDIA shares fell 27.28% over the past month after Jensen Huang left the chief executive role, leaving a $4.013 trillion chip company to explain both its roadmap and its governance. At $166.19, the stock sits just above its $163.90 52-week low, while the $319.99 average target from 62 analysts implies 92.5% upside.

Implied upside above 40% is rare at that market value. The arithmetic is striking; the governance evidence is not.

What changed at NVIDIA?

The Wall Street Journal reported Huang’s ouster, while NBC News reported that he resigned and that the stock fell afterward. Both reports followed a New York Times story about Huang’s relationship with an NVIDIA executive who reported to him. CFO Colette Kress is reportedly taking over on an interim basis.

Over the same month, the S&P 500 slipped 2.67%, against NVIDIA’s 27.28% decline. NVIDIA also lost 8.49% over the past week. The stock is down 10.68% year to date while the S&P 500 is up 11.05%; over one year, NVIDIA lost 14.04% as the index gained 10.81%.

What does the operating record show?

NVIDIA sells the GPUs, networking equipment and software behind most large AI data centers. Its latest quarter produced $96.221 billion in revenue, up 105.85% year over year, and non-GAAP earnings per share of $2.22, ahead of the $2.0887 consensus. Management expects gross margin to bottom at 71% to 72% in the fourth quarter because of memory costs.

Days sales outstanding rose to 60 days, which matters when a supplier and customer base changes quickly. NVIDIA has also put nearly $50 billion into frontier AI labs. That arrangement has drawn criticism as circular financing, and Kress said it should drive roughly one quarter of next year’s business.

Why does Raymond James still see $515?

Raymond James senior analyst Simon Leopold retained a Strong Buy rating and saw “limited reason” to expect near-term disruption to customer commitments or product roadmaps. His $515 target implies roughly 210% upside and applies a 22-times multiple to calendar 2028 earnings. It also assumes NVIDIA reaches an annual revenue run rate approaching $1 trillion by early 2029.

Leopold locates NVIDIA’s competitive advantage in its engineering organization, CUDA ecosystem and full-stack architecture. His argument rests on TSMC capacity, high-bandwidth memory supply and Vera Rubin rack deliveries, all described as locked in before deployment. A linked HBM report also said Samsung had locked up 70% of HBM capacity through 2031, reinforcing the tight allocation backdrop.

On the last earnings call, Kress guided to about 70% growth in fiscal 2028, with supply constraints limiting the figure. She put the revenue opportunity for Vera Rubin at $40 billion per gigawatt. Management’s $108.0 billion revenue guide for next week’s report provides the first near-term checkpoint.

Where do the analysts disagree?

Consensus fiscal 2028 earnings per share has risen to $15.9146 from $12.8148 90 days ago, so the earnings base used in bullish valuations has moved upward even as the share price fell. Much of the coverage remains positive:

• Consensus target: $319.99, implying 92.5% upside.
• Citigroup: applied a 25% key-person discount.
• Bernstein: cut its target in half to $200; Oppenheimer and Baird also cut targets or moved to the sidelines.
• Ratings: 10 Strong Buy, 49 Buy, 2 Hold and 1 Sell.

Many targets predate Huang’s departure, so they serve as guidance rather than fresh post-departure validation. The forward price-earnings ratio is roughly 11 times, which looks inexpensive only if the earnings path remains credible.

How do AMD and Broadcom compare?

The rest of the group held up as NVIDIA fell, leaving the stock comparisons unusually stark:

• Advanced Micro Devices slipped 3.34% over the month but gained 30.34% over the past week. At $585.30, against a $657.49 average target, its implied upside is about 12.3%; ratings stand at 5 Strong Buy, 39 Buy and 11 Hold.
• Broadcom rose 1.97% over the month and 24.06% over the past week. Its $364.36 share price compares with a $533.42 average target, implying 46.4% upside; ratings stand at 8 Strong Buy, 41 Buy and 2 Hold.
• NVIDIA still has the group’s largest implied upside at 92.5%. Most of that gap comes from its own price decline, which leaves investors pricing leadership risk that AMD and Broadcom do not carry.

What will next week settle?

The bull case requires NVIDIA to confirm the $108.0 billion revenue guide, ship Vera Rubin on schedule and name a credible permanent CEO quickly. The bear case gains weight if the governance scandal widens, the CEO search drags on, or financing for frontier AI labs becomes uncertain. Gross margin settling near the low 70s would remove some cushion.

At roughly 11 times forward earnings, NVIDIA looks like a damaged franchise whose customers and supply remain secured. I would treat the $319.99 average target as more realistic than the $515 best case, while still respecting the demand case. Next week’s results will show whether locked-in TSMC and HBM capacity can support margins and product commitments while investors wait for permanent leadership.