Nvidia eyes mobile growth

Article Excerpt

NVIDIA CORP. $12 (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 619.5 million; Market cap: $7.4 billion; Price-to-sales ratio: 1.9; No dividends paid; TSINetwork Rating: Average; www.nvidia.com) is down 5% in the past three months, mainly due to concerns that slowing sales of new computers will hurt demand for its graphic chips. However, the company continues to develop new chips for mobile devices. Consumer products like smartphones and tablets accounted for just 17% of Nvidia’s revenue in the quarter ended July 29, 2012, but the contribution from these chips should continue to rise. The company’s Tegra 3 chips power two new tablet computers: Google’s Nexus 7 and Microsoft’s Surface RT. The company’s strong balance sheet will also support its high research spending (26.9% of revenue in the latest quarter). Nvidia holds cash of $3.3 billion, or $5.29 a share. Its long-term debt is just $20.2 million. Nvidia is still a buy for aggressive investors. investors…