This Stock Prepares for Mature Growth
We can't all run and play like we did when we were younger, but with age comes experience...and we can still grow, just in different ways. The same goes for smart companies, observes Ian Wyatt of Top Stock Insights.
NVIDIA (NVDA) has been on a steady retreat since topping near $15 in August. In fact, the recent selling is only part of a much larger decline. NVDA was a $25 stock in early 2011.
The stock has been dragged lower during the past two years because PC sales have flatlined. Many analysts believe that the PC era is over, and since NVIDIA is a major supplier of the graphics chips inside PCs, a decline in PC demand hurts NVIDIA's business.
However, Wall Street seems to have forgotten that the company branched out beyond PCs. Their graphics cards, specifically Tegra and Icera, are in mobile devices-including Google's (GOOG) Nexus and Microsoft's (MSFT) Surface. This segment of NVIDIA is expected to grow sales by 50% in 2013. Moreover, TI exited the tablet industry, paving the way for another company to supply graphics processors for the Amazon.com (AMZN) Kindle lineup.
In addition to the future growth opportunities from mobile and handhelds, NVIDIA has an amazing balance sheet.