What could NVIDIA’s latest risks mean for the AI chip ecosystem?

 Analysts at Bank of America, Mizuho and Raymond James said in research notes that while governance concerns surrounding Nvidia (NASDAQ:NVDA) add near-term uncertainty, they are sticking with bullish ratings because the long-term fundamentals remain strong.

Nvidia shares came under pressure after CEO Jensen Huang acknowledged a “close relationship” with a Chinese executive at Singapore-based data center company Megaspeed, according to Mizuho, prompting congressional scrutiny and an independent board review of reported foreign-intelligence concerns. 

Nvidia’s board has said it has no reason to believe company secrets or national security were compromised.

BofA reiterated its Buy rating and $350 price target. Analyst Vivek Arya outlined three scenarios: containment with no material findings, prolonged uncertainty that weighs on the valuation, or escalation requiring earnings to be reassessed.

“We would not equate allegations with proven business damage,” Arya wrote.

He said AMD, Broadcom and Marvell could gain traction if Nvidia faces distractions. However, if scrutiny broadens, any U.S. supplier selling to China could see more volatility, while makers of analog chips and microcontrollers may be less exposed.

Mizuho cut its target to $250 from $315 but kept an Outperform rating. It expects upside from Nvidia’s Nov. 17 earnings and noted that stocks have on average been flat to higher 30 and 90 days after similar events.

Raymond James, which rates Nvidia a Strong Buy, said the pullback looks overdone and the stock trades at about 11 times its 2027 GAAP EPS estimate.

“We are uncertain regarding fundamental catalysts occurring before year-end, but we believe the AI thesis is largely intact,” analyst Simon Leopold said.