Morgan Stanley (NYSE:MS) has revised its price target for Nvidia (NASDAQ:NVDA) downward from $166 to $152, citing concerns over AI efficiency, export controls, and shifting investment sentiment following DeepSeek’s AI model release.
Key Factors Behind the Downgrade

Lower Valuation Multiple: Morgan Stanley cut Nvidia’s valuation multiple from 35x to 32x, reflecting investor caution over the sustainability of AI-driven growth.
DeepSeek’s Impact: The Chinese AI model, built with lower-cost hardware, raised efficiency concerns that could alter spending dynamics in AI infrastructure.
Export Control Compliance: Nvidia acknowledged DeepSeek’s ability to work within U.S. export restrictions, reinforcing China as a key revenue driver despite regulatory challenges.
Blackwell Transition: Demand for Hopper GPUs is slowing as customers anticipate the release of Blackwell products later in 2024.
Short-Term Headwinds: Potential manufacturing yield issues with the GB200 chip could weigh on near-term performance.

Long-Term AI Demand Still Strong
Despite the price target cut, Morgan Stanley maintains a bullish outlook on Nvidia’s long-term AI semiconductor prospects:

Strong demand for next-generation Blackwell GPUs
AI adoption trends expected to drive revenue growth in 2H 2024
Industry sentiment remains positive, with analysts stating, “This will not change our spending plans.”

Investor Takeaways

Track Nvidia’s latest analyst price targets using the Price Target Summary API to monitor changes in Wall Street expectations.
Assess broader AI industry trends with the Sector Historical API for insights into semiconductor sector performance.

Final Thoughts
While Nvidia faces short-term pressures, its long-term AI growth trajectory remains intact. Investors should closely watch Blackwell GPU adoption, China’s AI developments, and export policy shifts in the coming months.