Piper Sandler warns Nvidia (NASDAQ:NVDA) may see up to 6.45% of its vital data-center revenue at risk if corporate capex stalls.

Shares slipped 1.4% in premarket trade before paring losses after Piper Sandler reiterated an Overweight rating and $150 price target on NVDA. Analyst Harsh Kumar’s note points to the potential downside from capital-expenditure cuts and lingering China headwinds.

• Warning! GuruFocus has detected 3 Warning Signs with NVDA.

In Kumar’s worst-case scenario, roughly 6.45% of annual data-center revenueabout $9.8 billioncould vanish if capex budgets shrink and China demand fails to rebound. That hit would value Nvidia near $76.25 per share, assuming a conservative 25 times earnings multiple.

Conversely, in a best-case outlook under the same multiple, Nvidia’s shares could rise to about $126 if spending normalizes and China business returns. Despite the range, Piper Sandler sees more upside than downside, underscoring confidence in Nvidia’s leadership in AI hardware.

Kumar emphasizes that data-center sales anchor Nvidia’s cloud-AI thrust and account for the lion’s share of recent growth, making the segment especially sensitive to enterprise budgets and regulatory shifts. He notes that even a single-digit percentage hit in this high-margin business would create meaningful volatility in overall revenue and profit forecasts.

Why It Matters: A potential $9.8 billion swing in data-center revenue represents real cash-flow risk, forcing investors to weigh downside scenarios against Nvidia’s blockbuster AI growth story.

It’s important to note that Nvidia 12-month price-target consensus of $163.65 implies a 42.9% upside from its current $114.50 share price, based on 51 analysts’ projections that range from a conservative $100 low estimate to an ambitious $235.92 high. The dashed trajectory on GuruFocus charts shows average targets climbing steadily toward $164 by April 2026, while the high-end forecast surges above $235 and the low-end holds near $100. Meanwhile, brokerages maintain a bullish stance as evidenced by a 1.8 average recommendation from 64 firms87% rating NVDA as buy or outperform, with just 10% on hold and virtually no underperform or sell ratings. This combination of strong upward price guidance and consistent buy-side endorsement underscores broad confidence in Nvidia’s growth prospects through mid-2026.

This article first appeared on GuruFocus.