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Astera Labs: Analysts Calm NVLink Fusion Fears
6 Dec
Summary
- Stifel analyst maintained a Buy rating with a $200 price target.
- Concerns arose over Astera Labs' role in NVLink ecosystem post AWS/NVDA announcement.
- Firm states fears are misplaced, highlighting continued content opportunity.
Astera Labs, Inc. (NASDAQ:ALAB) is currently being closely tracked by analysts, with Stifel's Tore Svanberg reaffirming a Buy rating and a $200 price target. This assessment came after a significant stock price decrease, which was prompted by a joint announcement from AWS and NVDA about integrating NVLink Fusion into their Trainium 4 XPU deployments. The market reacted with apprehension regarding Astera Labs' potential displacement within the NVLink ecosystem, particularly concerning the switch opportunity.
However, Stifel has moved to alleviate these investor concerns, characterizing them as misplaced. The firm emphasized Astera Labs' ongoing support for the NVLink ecosystem and its active involvement in custom hyperscaler designs. This strategic positioning is expected to ensure a continued and substantial content opportunity for Astera Labs within NVLink Fusion designs across various hyperscaler deployments, underscoring its resilience.
Astera Labs designs and sells semiconductor-based connectivity solutions crucial for cloud and AI infrastructure. While acknowledging the stock's potential, some market observers suggest other AI stocks may offer more attractive risk-reward profiles. The company's role in next-generation AI infrastructure remains a key focus for investors evaluating its future growth prospects.
