NEW YORK (TheStreet) -- Graphics chip maker Nvidia (NVDA) tanked Friday after issuing a lower-than-expected second quarter forecast and receiving a price cut. AOL (AOL) soared by double digits after beating analysts' estimates, while Yelp (YELP) continued to gain ground on talk that it is looking for a buyer.
Nvidia tanked 7.4% to close at $20.83. The company took a beating after issuing a lower forecast for its second quarter. Nvidia now expects to generate revenue of $1.01 billion, within a 2% range higher or lower, but analysts were expecting $1.18 billion for the quarter.
A Wedbush analyst also cut Nvidia's price target to $24 a share from $25, citing the likelihood the company will continue to face challenging foreign exchange rates and a slowdown in the PC market as Windows 10 is set to roll out, according to a report in Benzinga. Wedbush, according to Benzinga, is likely to "trade in a tight range until the next significant catalyst."
With these two bits of dour news, Nvidia's announcement that it raised its dividend by 15% to $9.75 a share did not seem to ease investors' concerns.
AOL surged 10.2% to end the session at $43.42.
Investors cheered the online media giant for posting a stronger-than-expected first quarter. AOL reported diluted earnings of 34 cents a share on revenue of $625 million. Analysts were expecting net profits of 32 cents per share on revenue of $593.96 million.
AOL's better-than-expected performance was attributed to strong advertising sales, as well as that the company is seeing returns on its heavy investments into advertising technology, according to an Associated Press report.
Yelp jumped 6.2% to close at $49.93, marking a second day of sharp gains after reports surfaced Thursday it was looking for a buyer.
While some market observers believe Yelp will find it difficult to find a buyer, especially with Facebook which is building a similar business within its four walls, an analyst with Deutsche Bank believes differently.
Deutsche Bank analysts estimate there is a 60% chance Yelp will be acquired at a price ranging from $59 to $85 a share. As a result, Deutsche Bank raised its price target to $56 a share from $51, and maintains a buy rating on the company.