China may block this big acquisition

Article Excerpt

NVIDIA CORP. $505 is a buy. The company (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 609.0 million; Market cap: $307.5 billion; Price-to-sales ratio: 23.9; Dividend yield: 0.1%; TSINetwork Rating: Average; www.nvidia.com) recently agreed to buy U.K.-based Arm Holdings. That firm designs energy-efficient chips that power mobile phones, tablets, watches and a wide variety of other devices. Nvidia will pay up to $40 billion for Arm. It’s possible that Chinese regulators could block the deal, as many of China’s chipmakers rely on Arm’s technology. They fear Arm’s takeover by a U.S. firm would make it easier for the U.S. government to block access to future chip designs. However, Nvidia is confident it can win the necessary approvals to complete the deal by the end of 2021. Nvidia is a buy for aggressive investors. investors…