If you’ve ever had to deal with an overheating processor, you know what a problem that can be. Now, it seems like the entire chips stock sector has overheated, as several major names are down in Wednesday afternoon’s trading. Even Nvidia (NASDAQ:NVDA) is down—though just a small 0.12%—and that’s saying something in and of itself.
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Nvidia is down in Wednesday afternoon’s trading, but who else is? AMD (NASDAQ:AMD) is down a hefty 3.26% at the time of writing, and Intel (NASDAQ:INTC) is down around 2.7%. Wolfspeed (NYSE:WOLF) is short 1.47%, while three others—Synopsis (NASDAQ:SNPS), Texas Instruments (NASDAQ:TXN), and Qualcomm (NASDAQ:QCOM)—are all down fractionally in Tuesday afternoon’s trading.
Nvidia received some analyst love, with Raymond James’ Srini Pajjuri not only maintaining a Strong Buy rating on Nvidia but also upping estimates. However, that wasn’t enough to keep Nvidia out of negative territory like everyone else, a negative halo effect of sorts in play. Meanwhile, Intel cut its own throat by ending a merger with Tower Semiconductor (NASDAQ:TSEM), a chip foundry out of Israel. Intel was instead focused on its own foundry efforts. That’s a noble move, but it puts the cart before the horse by not having a reliable foundry working while it builds its own. And with Wolfspeed and Synopsis, both still awaiting second-quarter results, that left investors on edge.
Nvidia has been the chip sector’s darling for months now, but it’s not the best or worst deal in this run. Best goes to AMD, a Strong Buy with 31.73% upside potential thanks to its average price target of $141.90. Worst, meanwhile, goes to Intel; Intel currently carries an analyst consensus rating of Hold, and its average price target of $36.07 means it offers a 6.62% upside potential.
