UPDATE: Bank of America Downgrades NVIDIA to Neutral

Bank of America has published a research report on NVIDIA Corporation

and has downgraded the company from Buy to Neutral based on the expectation that the company will be facing higher costs near-term. In the report, Bank of America writes, "We downgrade Nvidia from Buy to Neutral as the company faces near-term (higher 28nm costs/supply) and longer-term (mobile processor competition, Ultrabooks use integrated graphics) risks that make it harder to outperform the sector. We lower FY13/14E (~CY12/13E) EPS from $1.04/$1.22 to $0.71/$0.91. Ex stock comp, we model $0.94/$1.15 in pro-forma EPS, and maintain our $16.50 Px Tgt. We model $440mn in FY13 Tegra mobile processor sales, well below Nvidia's outlook of at-least $540mn. Nvidia guided 1FQ13 sales to $915mn (midpt), below our $926mn and Street's $940mn expectations. Solid balance sheet and cash flow provides cushion." NVIDIA is currently trading up $0.14 from yesterday's $16.17 closing price.