NVIDIA Corporation (NVDA): Today's Featured Electronics Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NVIDIA Corporation ( NVDA) pushed the Electronics industry lower today making it today's featured Electronics laggard. The industry as a whole closed the day up 0.5%. By the end of trading, NVIDIA Corporation fell 14 cents (-1.1%) to $11.97 on average volume. Throughout the day, 12 million shares of NVIDIA Corporation exchanged hands as compared to its average daily volume of 10.5 million shares. The stock ranged in price between $11.87-$12.23 after having opened the day at $12.16 as compared to the previous trading day's close of $12.10. Other companies within the Electronics industry that declined today were: Spire Corporation ( SPIR), down 15.3%, Aetrium Incorporated ( ATRM), down 11.4%, TranSwitch Corporation ( TXCC), down 7.6%, and Netlist ( NLST), down 5.3%.
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NVIDIA Corporation provides graphics chips for use in smartphones, personal computers (PC), tablets, and professional workstations markets worldwide. It operates in three segments: Graphic Processing Unit (GPU), Professional Solutions Business (PSB), and Consumer Products Business (CPB). NVIDIA Corporation has a market cap of $7.97 billion and is part of the technology sector. The company has a P/E ratio of 16.9, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are down 12.7% year to date as of the close of trading on Friday. Currently there are 11 analysts that rate NVIDIA Corporation a buy, one analyst rates it a sell, and 20 rate it a hold.

TheStreet Ratings rates NVIDIA Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, A123 Systems ( AONE), up 53.9%, SatCon Technology Corporation ( SATC), up 42.3%, LDK Solar Company ( LDK), up 21.1%, and Vimicro International Corporation ( VIMC), up 12.1%, were all gainers within the electronics industry with Altera ( ALTR) being today's featured electronics industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the electronics industry could consider iShares Dow Jones US Technology ( IYW) while those bearish on the electronics industry could consider ProShares Ultra Short Semiconductor ( SSG).

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