Nvidia Falls as Citron Research Says Stock ‘Belongs at $90’

Jen-Hsun Huang, chief executive officer of Nvidia.

Photographer: David Paul Morris/Bloomberg

Shares of graphics chipmaker Nvidia Corp. fell the most in almost month after an investment newsletter run by activist short seller Andrew Left said the stock “belongs at $90.”

Nvidia has more than tripled this year to $117.32 at Tuesday’s close. Left’s Citron Research listed six risks that shareholders are discounting, including that much of Nvidia’s growth comes from gaming and at the expense of rival Advanced Micro Devices Inc., as opposed to from new markets. Citron also said there is significant competition from existing and emerging players and the arrival of Intel Corp. into the fray in mid-2017 could have a “significant impact” on Nvidia’s gross margins.

Nvidia was down 6.8 percent to $109.38 at 2:27 p.m. in New York after rising 6.9 percent Tuesday. The company has been the best performer on the Nasdaq 100 Stock Index this year, outpacing the No. 2 stock by about three times.

Under Chief Executive Officer Jen-Hsun Huang, Nvidia has built itself into the leading supplier of graphics processors, the chips that deliver the ever-more-realistic images that make computer games so immersive and addictive. This year Huang’s longtime belief that the fundamental advantages of his graphics chips would give them a broader role in fast-growing fields such as artificial intelligence and self-driving cars has begun to pay off -- and buoyed Nvidia’s earnings.

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