The ongoing trade war between the U.S. and major global economies has led to volatility across multiple industries. One of the biggest names affected is Nvidia stock (NASDAQ:NVDA), which has dropped 30% from its all-time highs in 2024. With President Donald Trump’s “Liberation Day” announcement on April 2 expected to introduce more tariffs, investors are left wondering whether this is an opportunity to buy the dip in Nvidia stock or if further downside is ahead.
Nvidia Stock: A Victim of Market Volatility
The S&P 500 Index (NYSEARCA:SPY) has declined 5% year-to-date as investors brace for potential economic disruptions. Reports suggest the Trump administration is considering broad 20% tariffs, which could significantly impact manufacturing and tech companies like Nvidia.
In recent weeks, major tech stocks such as Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), and Tesla (NASDAQ:TSLA) have suffered losses exceeding 10%. Nvidia, a leader in AI and semiconductor technology, has not been spared. Rising costs, concerns over supply chain disruptions, and slowing global demand have all contributed to the stock’s recent slump.
However, some analysts believe that Nvidia’s decline presents a buying opportunity rather than a warning sign.
Nvidia’s AI Expansion Plans Could Drive Future Growth
Despite market concerns, Nvidia stock remains well-positioned for long-term growth due to its continued expansion in artificial intelligence (AI) and high-performance computing. CEO Jensen Huang recently unveiled plans for the company’s Blackwell chips, which promise up to 40x performance improvements over previous models.
Additionally, Nvidia is investing in silicon photonics technology, enabling the creation of AI supercomputers with reduced energy consumption. This move aligns with Nvidia’s broader strategy of scaling its AI capabilities across industries, from cloud computing to autonomous vehicles and robotics.
The company has also launched the DGX Station, a high-powered AI workstation designed for enterprise customers. This expansion beyond traditional gaming GPUs could provide Nvidia with new revenue streams in the coming years.
Is Nvidia Stock a Buy at Current Levels?
While the current market downturn has negatively impacted Nvidia stock, many analysts remain optimistic. The company is expected to increase revenue by nearly 19% annually over the next five years, with free cash flow projected to grow at an even faster pace of 26% per year.
By fiscal 2030, Nvidia’s free cash flow is forecasted to reach $193 billion, compared to just $60.7 billion in fiscal 2025. If Nvidia stock maintains a 30x free cash flow multiple, its share price could more than double over the next five years.
Currently, 44 analysts cover Nvidia stock:
- 38 recommend a “Strong Buy”
- 2 suggest a “Moderate Buy”
- 4 rate it as a “Hold”
The average price target for Nvidia stock is $177.19, representing a 65% upside from current levels.
Conclusion: Should You Buy the Dip in Nvidia Stock?
While short-term risks remain due to tariffs and global economic uncertainty, Nvidia’s long-term fundamentals appear strong. The company continues to lead in AI innovation, expand into new markets, and generate substantial cash flow growth.
For long-term investors, the recent decline in Nvidia stock may present a buying opportunity before the next major AI-driven growth cycle.
Featured Image – Megapixl
