Nvidia Stock Falls as Bank of America Removes It from Top US Picks List

Key Takeaways

• Bank of America removed Nvidia, Micron Technology and Lam Research from its US 1 List while maintaining Buy ratings on all three companies.
• Nvidia shares extended their decline on Tuesday, closing at $168.89 after falling 5.47%.
• Nvidia’s November 17 earnings announcement will provide the next major update on AI demand, revenue growth and its business outlook.

Bank of America Removes Three Chipmakers from Its Preferred List

Bank of America has removed Nvidia, Micron Technology and Lam Research from its US 1 List of preferred US equity ideas, reducing their prominence within the bank’s selected recommendations.

All three semiconductor companies retain Buy ratings. The change therefore represents a removal from the bank’s highest-conviction selections rather than a formal ratings downgrade.

The US 1 List draws from Buy-rated, US-listed companies covered by the bank’s equity research analysts. Inclusion signals an additional level of preference within that broader coverage universe.

No specific explanation for the removals was disclosed in the available reporting. Consequently, the change alone does not establish that Bank of America has lowered its earnings expectations or identified a deterioration in the companies’ operations.

The decision nevertheless arrives at a sensitive point for Nvidia, with its share price under pressure ahead of a closely watched earnings announcement.

Nvidia Shares Extend Their Decline

Nvidia closed Monday, November 9, at $178.67, down 4.27%. Selling continued on Tuesday, when the stock fell a further 5.47% to $168.89.

Across the two sessions, the shares lost approximately 9.5%, calculated from Friday’s closing price of $186.64. The latest close also left Nvidia below its October 30 closing level of $204.64.

The sequence matters when assessing the market reaction. Monday’s decline preceded the Tuesday reports of Bank of America’s list adjustment, so the full sell-off cannot be attributed to that decision.

A preferred-list removal can affect sentiment, particularly when a stock is already falling. However, share prices also reflect broader market conditions, company developments and changing expectations for future earnings.

For Nvidia, the recent weakness has increased the importance of its forthcoming results. Investors will be looking for evidence that operating performance remains strong enough to support confidence despite the stock’s retreat.

Wells Fargo Lowers Its Nvidia Price Target

Separately, Wells Fargo reduced its Nvidia price target to $300 from $315 while maintaining an Overweight rating.

The revision represents a reduction of approximately 4.8% in its target price. It shows a more cautious valuation assessment while preserving a favourable overall recommendation.

Price targets, stock ratings and preferred-list membership communicate different judgments. A target expresses an analyst’s valuation estimate, a rating summarises the investment recommendation, and a selected list identifies a narrower group of preferred ideas.

Those distinctions help explain why a bank can lower a target or remove a company from a shortlist while continuing to rate the shares positively.

Analyst targets also remain conditional forecasts. They depend on assumptions about revenue, margins, valuation multiples and business risks, all of which can change following new information.

November 17 Earnings Will Test the AI Growth Outlook

Nvidia has scheduled its fiscal third-quarter earnings conference call for Tuesday, November 17, at 5 p.m. Eastern Time. The results cover the quarter ended October 25, 2026.

The company enters the announcement following substantial growth in its previous quarter. Nvidia reported fiscal second-quarter revenue of $96.2 billion, up 106% from a year earlier. Data Center revenue reached $89 billion, increasing 117% year on year.

Its previously issued third-quarter guidance called for revenue of $108 billion, plus or minus 2%. Nvidia also projected GAAP and non-GAAP gross margins of approximately 74%, plus or minus 50 basis points.

The revenue outlook did not assume any Data Center compute revenue from China, an important qualification when assessing the geographic assumptions behind the forecast.

These figures provide a benchmark for the report. However, meeting an existing forecast may not be sufficient to determine the share-price response. Markets will also assess management’s forward guidance and whether its commentary changes expectations for subsequent quarters.

What Investors Will Watch Beyond Revenue

The forthcoming report will offer an opportunity to assess several questions beyond the headline sales figure.

First, investors will examine whether AI infrastructure demand continues to translate into revenue at the pace implied by existing guidance. Commentary on customer spending and deployment schedules could help clarify the durability of that demand.

Second, margins will indicate how effectively Nvidia is converting sales growth into profitability. Revenue expansion can coexist with pressure from product transitions, manufacturing costs or changes in the sales mix.

Third, management’s outlook will help investors evaluate whether current earnings expectations remain appropriate. A strong completed quarter and a cautious forward forecast could produce a different market reaction from similarly strong results accompanied by higher guidance.

These are analytical considerations rather than confirmed explanations for Bank of America’s decision. Without a disclosed rationale, the list adjustment should not be treated as evidence that any particular operating risk has materialised.

Positive Ratings Remain, but Earnings Carry Greater Weight

Bank of America’s decision leaves Nvidia in an unusual position: it retains a Buy rating while losing its place among the bank’s preferred US stock ideas.

That combination suggests a distinction between a positive investment recommendation and the stronger preference associated with shortlist inclusion. It does not, by itself, resolve the debate over Nvidia’s valuation or near-term prospects.

The November 17 results will provide more direct evidence. Strong execution and supportive guidance could help restore confidence, while disappointing figures or a cautious outlook could leave the shares vulnerable to further pressure.

For now, the list removal adds another sentiment challenge during a sharp share-price decline. Nvidia’s operating results and forward expectations will be central to determining whether confidence stabilises.

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