Nvidia's ai edge: why one analyst says buy now despite tariff headwinds

Nvidia's ai edge: why one analyst says buy now despite tariff headwinds

2025-04-08 nvidia

New York, Tuesday, 8 April 2025.
Despite concerns about potential tariffs, Wedbush analyst Dan Ives is telling investors to buy Nvidia stock. He believes in Nvidia’s long-term potential, particularly its dominance in the artificial intelligence sector. Ives suggests that even with tariffs potentially causing an ‘economic Armageddon,’ Nvidia remains a top tech stock to own. He also warns that tariffs could set the us tech sector back a decade, making cybersecurity stocks a safer bet in the current volatile climate.

Tariffs as a major market disrupter

President Trump’s proposed tariffs have injected considerable volatility into the stock market [4]. The technology sector, in particular, faces potential setbacks due to these policies [7]. Ives has described these tariffs as potentially the ‘biggest debacle ever seen in the markets’ and a ‘purely self-inflicted’ wound [7]. He also notes that the tariffs could trigger an ‘economic Armageddon’ due to the interconnectedness of global supply chains [2][7]. These concerns have led to significant market fluctuations and a reassessment of investment strategies within the tech industry [4].

Nvidia’s long-term prospects

Despite near-term market anxieties, Ives emphasizes that Nvidia’s fundamental strengths remain intact [4]. He points to the company’s robust installed base, technological leadership, and significant long-term growth opportunities as key reasons to maintain a bullish outlook [4]. Nvidia’s leadership in the artificial intelligence (AI) sector is a critical factor driving this positive assessment [1][7]. Ives highlights that the United States, largely due to companies like Nvidia, currently leads China in AI, marking a significant shift in the global technology landscape [7].

Nvidia’s AI chips are primarily produced in Taiwan, making them subject to a potential 32% duty under the proposed tariff regime [2]. This could significantly impact the company’s cost structure and competitive positioning [2][7]. Ives suggests that the market needs to ‘essentially toss out the next few quarters’ and develop new financial models for 2026, anticipating that the tariff situation will stabilize through negotiations [4]. This implies a need for investors to adopt a longer-term perspective when evaluating Nvidia’s stock [1].

Cybersecurity as a defensive play

Given the uncertainties surrounding tariffs and their potential impact on semiconductor companies like Nvidia, Ives suggests that investors consider rotating into cybersecurity stocks [4]. He identifies ZScaler, Palo Alto Networks, and CrowdStrike as ‘defensive names’ that could outperform in the current market environment [4]. This recommendation reflects a broader strategy of seeking refuge in sectors less exposed to the immediate shocks of tariff-related trade disruptions [4]. The shift towards cybersecurity highlights a focus on stability during market turbulence [4].

Market performance and analyst ratings

Recent market volatility has led to some analysts revising their price targets for tech stocks [5][8]. However, Ives maintains a ‘buy’ rating for Nvidia, signaling confidence in its long-term value [4][8]. Despite potential short-term headwinds, the consensus among analysts remains cautiously optimistic, with many still rating Nvidia as a worthwhile investment [8]. Investors are closely watching how the company navigates the tariff landscape and whether it can sustain its competitive advantage in the rapidly evolving AI market [1][7].

Bronnen


NVIDIA Tariffs