Shares of Nvidia Corp (NVDA) are getting smoked today, down over 5%, to around $103. Shares are moving lower after Pacific Crest downgraded the stock to Underweight from Sector Weight.

According to reports, the analyst is concerned about signs of desktop saturation, lower margins from Nintendo and a slowdown in the NVDA datacenter. Nvidia is supplying a custom Tegra chip for Nintendo's Switch game console.

We have been writing here for weeks, maybe even months at this point, that one of Nvidia's biggest challenges in 2017 would be itself. Expectations and valuation were set very high for this company. On March 22, we said that $110 was the biggest hurdle for the stock from a technical perspective, and that was still true as trading began this week. (See also: Nvidia Not Out Of The Woods Yet.)

Simply put, Pacific Crest's note questions Nvidia's growth story. In fact, even at $102, the stock is trading at a 2017 forward P/E of 31 and a 2018 forward P/E of 27. It's certainly not cheap for a company expected to grow EPS by only 15% from 2017 to 2018. (See also: NVDA Is Already Priced to Perfection Based on MBLY.)

On March 7, we discussed the idea that NVDA could trade to the low 90's or upper 80's. (For more, see: Nvidia Continues Its Dance With Analysts.) The recent failure of the stock and its inability to break through the $110 level is a clear sign there is a tremendous amount of selling pressure in the name. If sellers begin to get worried about the growth story or the upcoming quarterly results, which likely comes around the beginning of May, the selling will only get worse as lower prices will beget more selling. 

NVDA Short Interest Chart

NVDA Short Interest data by YCharts

In recent weeks, the short interest level has dropped dramatically, which means it is also possible the shorts could begin to add pressure to this name. If you own this name for "trade," be very careful. Stocks can move very quickly when a growth stock's growth story comes into question. 

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