Why NVIDIA plunged intraday, specifically on February 28, 2026. The stock dropped 4.16% that day, so I need to explain the immediate causes behind this sharp decline.
First, I should check the relevant news to see if there were any specific events or reports that triggered the sell-off. The news articles mention that NVIDIA fell after its earnings report, which was strong but failed to impress investors. There's also talk about broader AI fears and market sentiment shifting.
Looking at the provided data, the stock had high trading volume of 311.87 million shares, and the volume ratio was 1.37, indicating heightened activity. The capital flow data shows significant outflows on February 26, which might have contributed to the downward pressure.
The news highlights several factors: the earnings report didn't meet sky-high expectations, there's growing anxiety about AI's economic impact, and broader market issues like private credit concerns and inflation data. These elements combined likely caused the plunge.
I should structure the response by first stating the conclusion—that the drop was due to a mix of earnings disappointment and broader AI fears—then break down the supporting points: the earnings reaction, the AI "fear trade," and broader market pressures. Finally, I'll summarize with a neutral note on valuation and risks.
The response needs to be factual, citing the news sources where applicable, and avoid any speculative language or investment advice. I'll also include the required compliance disclaimer at the end.
NVIDIA's sharp intraday decline on February 28, 2026, was primarily driven by a market reaction of "selling the news" following its Q4 earnings release, compounded by growing macroeconomic anxieties and a broad-based "AI fear trade" impacting the entire technology sector168.
Conclusion: NVIDIA's stock fell 4.16% on February 28, closing at $177.19, due to a combination of investor profit-taking after stellar earnings, escalating fears about AI's economic disruption, and negative broader market sentiment.
Supporting Points:
Earnings-Driven Profit-Taking and Elevated Expectations: Despite reporting record-breaking Q4 revenue of $681.3B (a 94% year-over-year increase), the stock failed to rally28. This is a classic "sell the news" event where the results, while exceptional, were already priced into the stock following a massive rally. Investors chose to lock in profits, leading to the stock's largest single-day drop in over a year on the report's release1. Furthermore, analysts noted that the company's massive $700B+ investments in clients and partners, while strategic, raised questions about capital allocation and future returns27.
The "AI Fear Trade" and Sector-Wide Pressure: A significant and overarching theme driving the sell-off was a market-wide anxiety regarding AI's potential to disrupt the economy. A widely circulated research scenario depicting massive white-collar job losses by 2028 due to AI success spooked investors, creating what media termed an AI "scare trade"89. This fear was not isolated to NVIDIA but dragged down the entire tech sector, with major peers like Meta, Microsoft, and AMD also falling around 2%2. The decline was exacerbated by a sharp sell-off in NVIDIA-linked companies like CoreWeave, which plunged over 17%3.
Broader Market Headwinds and Technical Factors: The decline occurred within a challenging macro environment. Hotter-than-expected producer price index (PPI) data renewed inflation concerns, clouding the Federal Reserve's interest rate path20. Simultaneously, stress in the private credit market, highlighted by issues at firms like Apollo Global Management, triggered a "panic" rotation out of risk assets823. Technically, the stock faced resistance near the $187.67 level and saw significant net capital outflows, with over $655M leaving on February 26 alone, indicating institutional selling pressure.
Conclusion: The intraday plunge reflects a market grappling with the implications of NVIDIA's own success. While its fundamental performance remains robust, the stock is currently acting as a proxy for broader investor anxieties about AI's societal impact, inflation, and financial stability. The high trading volume of 311.87M shares (Volume Ratio 1.37) confirms intense market participation in this corrective move.
The TigerAI's reply is for reference only and does not constitute investment advice.
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What are analysts saying about NVIDIA's outlook now?
Could NVIDIA's investments impact future earnings significantly?
How might macroeconomic trends affect NVIDIA moving forward?
Analysts remain overwhelmingly bullish on NVIDIA despite the recent stock decline, with a strong consensus buy rating and an average price target suggesting significant upside potential from current levels16.
Conclusion: Wall Street analysts maintain a strongly positive outlook on NVIDIA, with 39 buy recommendations, 4 hold ratings, and only 1 underperform rating, reflecting continued confidence in the company's AI leadership and growth trajectory despite recent market volatility.
Supporting Analysis:
Overwhelmingly Bullish Consensus: According to the latest analyst data, NVIDIA has 39 buy recommendations, 4 hold ratings, and only 1 underperform rating, representing a 91% buy rating consensus. This strong analyst support indicates continued confidence in the company's fundamentals despite the recent 4.16% decline.
Significant Price Target Upside: The mean analyst target price is $258.87, representing approximately 46% upside from the current price of $177.19. The target range spans from $138.00 to $432.78, showing substantial divergence in long-term expectations but clear consensus on upside potential1.
Recent Analyst Actions: Following the Q4 earnings release, several major firms have reaffirmed or adjusted their bullish stances:
CICC maintained its Outperform rating while adjusting its price target to $240.60 from $2281
Goldman Sachs analyst James Schneider kept a Buy rating with a $250 price target, stating that NVIDIA's "strong guidance will sustain the move higher"4
HSBC maintained its Buy rating while adjusting its price target to $295 from $3106
Evercore ISI analyst Mark Lipacis maintained a Buy rating with a $352 price target, one of the highest among major firms7
Fundamental Support for Bullish Thesis: Analysts cite several key factors supporting their positive outlook:
Record-breaking Q4 performance with revenue of $681.3B (94% YoY growth) and data center revenue of $623B (75% YoY growth)
Strong forward guidance for Q1 2027 of $764-796B (midpoint $780B), significantly exceeding market expectations of $728B
Maintained premium margins with GAAP gross margin at 75.0% and non-GAAP at 75.2%
Continued AI infrastructure demand with global hyperscale data center capital expenditures projected at $660-690B for 2026
Valuation Considerations: Despite the stock's decline, analysts note that NVIDIA's forward P/E ratio of 22.95 is below its historical average of 41.68 and well below the +1 standard deviation level of 50.89. This suggests the stock may be trading at attractive levels relative to its growth prospects.
Conclusion: The analyst community views NVIDIA's recent stock decline as a buying opportunity rather than a fundamental deterioration. The consensus remains that the company's AI leadership, strong financial performance, and robust guidance justify continued bullish ratings, with price targets implying substantial upside from current levels. However, analysts acknowledge the stock faces near-term headwinds from macroeconomic concerns and "AI fear trade" sentiment that could create volatility despite strong fundamentals.
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