Nvidia Corporation (NASDAQ: NVDA) is in focus on Monday after famed investor Jim Cramer turned “negative” on the semiconductor company.
Cramer dubs Nvidia stock a ‘loser’
Cramer has been a strong proponent of Nvidia Corporation since 2017 when he even nicknamed his dog after the multinational.
That era, however, came to an end this morning when he said the Ethereum “Merge” meant bad news for Nvidia Corporation.
I’m concerned about Nvidia. Ethereum’s new merger means that you don’t need their graphic cards anymore to mine. That has been an unintended consequence for Nvidia Corporation. So, we’re short Nvidia. It’s a loser.
Last month, the Nasdaq-listed firm reported revenue for its fiscal second quarter that came in sharply below the Street estimates. Nvidia stock is currently down more than 55% for the year.
Nvidia has had a string of bad news recently
Earlier in September, the United States also restricted sales of high-end chips to China (source). “Ethereum”, therefore, was the second significant hit to Nvidia this month.
Further explaining his bearish view on NVDA this morning on CNBC’s “Squawk on the Street”, Cramer added:
They haven’t been able to make the transition yet to artificial intelligence, virtual reality, machine learning. We’re just not there yet. So, we have the high-tech stuff not there yet producing earnings and the lower stuff being hurt by this Ethereum transfer.
On the flip side, however, Cathie Wood remains convinced as ever in the chipmaker and has been buying Nvidia shares on recent weakness. She even sold a significant chunk of Tesla Inc to load up on Nvidia. (source)