Earlier today, UBS noted a change in the resale market for graphics processing units (GPUs), observing an increase in average prices despite a downturn in sales volumes. Analyst Timothy Arcuri pointed out a subtle 1% increase in AMD’s (NASDAQ:AMD) products, whereas Nvidia’s (NASDAQ:NVDA) GPUs rose by 3%. AMD products saw pressure at the high end of the spectrum but saw more stability in its mid and lower-tier offerings. Interestingly, Nvidia witnessed a general dip at the lower end of its spectrum with mixed results in the high-end market.
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Arcuri also delved into the notable slump in transaction volumes. He noted that this decrease seems more tied to a significant dip in available GPUs on the market rather than dwindling demand, marking the scantiest inventory noted since UBS started monitoring this data about a year ago. Arcuri hypothesized that this shrinkage might indicate a slowdown in the GPU upgrade cycle, potentially triggered by the release of Nvidia’s Ada Lovelace chips or consumers postponing purchases in anticipation of Black Friday deals. He underlined that, despite these shifts in the secondary market, projections for Nvidia’s gaming segment in the next quarter still hint at a growth of about 3%.
Is NVDA Stock a Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on NVDA stock based on 40 Buys and one Hold assigned in the past three months, as indicated by the graphic above. In addition, the average price target of $636.32 per share implies 46.8% upside potential.
