然而，随着年底的临近，In 2024, the stock prices of NVIDIA, Broadcom, and Marvell Technology surged due to the AI boom, but as the Market Cap approached 4 trillion dollars, short-selling interest increased significantly.
With the significant increase in these semiconductor stocks in 2024, more and more investors are beginning to bet that the stock prices of NVIDIA, Broadcom, and Marvell Technology will decline.
In 2024, benefiting from the explosive growth of generative AI technology, the stock prices of related companies surged significantly. Multiple Semiconductors stocks greatly outperformed the Large Cap. $NVIDIA (NVDA.US)$ The stock price skyrocketed by 182%, $Broadcom (AVGO.US)$ increased by 119%, $Marvell Technology (MRVL.US)$ Increased by 92%. Meanwhile,$S&P 500 Index (.SPX.US)$Increased by 27%.
However, as the end of the year approaches, more and more investors are beginning to short these three large semiconductor stocks. As of mid-December, the number of shares shorted of these companies—known as short interest—has increased.
According to Dow Jones market data, NVIDIA's short interest increased by 5.9% in mid-December compared to the end of November, reaching the highest level since August 16. $Marvell Technology (MRVL.US)$ Short interest surged by 25% in mid-December, also setting a record high since August, while Broadcom's short interest increased by 3.3%, the highest level since November 2023.
There are several reasons for the rising short interest in these outstanding stocks. Firstly, these stocks are generally highly valued, with NVIDIA's PE at 32.8 times, Broadcom at 36.7 times, and Marvell Technology—having the highest short interest—at an astounding 43.9 times. As these companies announce their Earnings Reports in February, market expectations for them are extremely high. If they underperform, stock prices may fall significantly.
The uncertain geopolitical environment may also be causing some investors to feel concerned. The intensifying competition with China and the uncertainty of export control policies may affect market sentiment.
Regardless of the reasons for the increased short interest, no conclusion has been reached yet. In fact, most Analysts remain Bullish on these three stocks, with a FactSet survey showing that the vast majority of Analysts rate them as 'Buy'.
On December 19, Raymond James analyst Srini Pajjuri raised the Target Price for Marvell Technology from $120 to $130 and reaffirmed a "Outperform" rating for the stock. In a research report, he stated that with the continuous rise in demand for AI Semiconductors, the company could achieve a 25% annual revenue growth in the next three to four years.
Subsequently, on December 20, Morgan Stanley Analyst Joseph Moore stated that NVIDIA, Broadcom, and $Astera Labs (ALAB.US)$are the Stocks he is Bullish on for 2025. In the report, he advised investors to "continue to increase investment in AI and Datacenter sectors."
These Stocks may continue to rise next year, but the recent increase in short interest also serves as a reminder that risks remain for any Stock.
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Editor/Rocky