RawGreed Requests, NVDA

Posted on November 14, 2005 , filed under Stocks | Print This Post

Roberto writes,

My portfolio today: CHK,NVDA, VRSN,ADBE. Any comment or analysis?

All of the companies in your portfolio are strong recent performers. I covered ADBE, Adobe Systems Inc. in my blog earlier. I’ll address two of the companies in your portfolio, NVDA and VRSN. NVDA, NVIDIA Corp. is a manufacturer of GPU’s, graphic’s processing units for PC video cards, consoles and mobile devices. The company is the main competitor to ATYT, ATI Technologies Inc., a RawGreed recommended stock that I invested in earlier this year. I believe in the short run, 3-6 months, NVDA will continue to rise on strong sales of its 7800 line of GPU’s. Nvidia’s business is highly cyclical and when products start to build a glut with OEM’s, distributors and retailers, NVDA tends to drop. NVDA has dropped to under $10 in the last 2 years before rebounding to today’s current levels. NVDA will benefit tremendously from providing the graphics technology for Sony’s Playstation 3. This should drive revenue up to record levels for the company. Still, due to how quickly graphics technologies go in and out of favor with gamers, I wouldn’t invest in NVDA at today’s prices. I don’t see it happening, but I would feel more comfortable investing in the stock on a pullback to low 20’s in the next 3-6 months.

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