New chips spur Nvidia’s growth

Article Excerpt

NVIDIA CORP. $54 (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 534.0 million; Market cap: $28.8 billion; Price-to-sales ratio: 5.5; Dividend yield: 0.9%; TSINetwork Rating: Average; www.nvidia .com) is a leading designer of 3D-capable video chips, which make video games run more smoothly and appear more lifelike. In its fiscal 2017 first quarter, which ended April 30, 2016, Nvidia’s revenue rose 13.4%, to $1.31 billion from $1.15 billion a year earlier. Strong demand for its latest gaming chips drove the gains. The company earned $263 million in the quarter. That’s up 40.6% from $187 million a year earlier. Per-share profits rose 39.4%, to $0.46 from $0.33, on more shares outstanding. Nvidia spends a high 27% of its sales on research. The stock has jumped 65% since the start of 2016. It now trades at a high 34.4 times the $1.57 a share that the company should earn for fiscal 2017. The $0.46 dividend yields 0.9%. Nvidia…