Nvidia’s research spending set to pay off

Article Excerpt

NVIDIA CORP. $14 (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 547.8 million; Market cap: $7.7 billion; Price-to-sales ratio: 2.7; WSSF Rating: Average) continues to spend a high 25% of its revenue on developing new chips. For example, Nvidia has combined processing power and graphics functions onto its new Tegra chip. Tegra brings high-definition graphics to handheld devices, including Microsoft’s upcoming Zune HD music player. Nvidia has also started selling its Ion video-chip platform, which greatly improves the performance of small “netbook” computers. These new chips should lower Nvidia’s reliance on traditional computers. Nvidia is a buy. buy…