Nvidia’s star starting to rust could be a major theme in the market next year. There are some other notable chip plays on Wall Street. The chip giant has posted an impressive return of more than 160% this year. Stocks have soared in recent years as artificial intelligence has gained mainstream appeal. But Nvidia has been flashing some warning signs lately. The stock has fallen more than 6% this month and entered a correction this week. Generally speaking, a correction is when a stock’s price is at least 10% below its highest closing price. Nvidia helped the Dow Jones Industrial Average snap a 10-day losing streak on Wednesday, the first since 1974. NVDA YTD Mountain Nvidia, Year to Date It’s true that Wall Street is optimistic about the stock’s future. The typical analyst surveyed by FactSet rates the stock a Buy, and the consensus price target suggests the stock could rise more than 35% over the next 12 months. Still, the recent turmoil may make investors consider other options. CNBC Pro screened FactSet for stocks that met the following criteria as of Tuesday: Undervalued than Nvidia with a forward price/earnings ratio of less than 44 times At least 55% of analysts rated it a buy Average Price Target Finally Up 20% Here are the companies that made the list: Advanced Micro Devices has had a much worse year than Nvidia, falling more than 17% year-to-date. Still, analysts remain optimistic, with the stock trading at a forward price-earnings ratio of 37.6 times. Roughly two out of three analysts surveyed by FactSet rate it a buy. The average price target suggests the stock could rise more than 48%. In a note to clients on Wednesday, Piper Sandler analyst James Fish cited AMD as one way to revive data center popularity. More specifically, he pointed to the areas of computing and silicon as areas of opportunity. Elsewhere, Universal Display is another lesser-known name. The stock, which focuses on organic light-emitting diode (OLED) technology, fell 22% in 2024. The stock’s expected price/earnings ratio (PER) is 32.5 times. Although the stock has struggled this year, more than seven out of 10 Wall Street analysts rate it a “buy.” The average price target suggests the stock could rise more than 39%.
