I have been bullish on NVIDIA (NVDA, Financial) for quite some time primarily because of the company’s diversified revenue stream. NVIDIA has almost doubled since my initial recommendation, and despite the rally, the stock has more upside to offer.
Focusing on laptop graphics
Recently, NVIDIA detailed its three new laptop graphics cards –Â GTX 1080, 1070 and 1060. All these new graphics cards are based on the company’s latest Pascal architecture. Furthermore, the company said these graphics cards are the ideal foundation for building notebook platforms that facilitate virtual reality (VR) to be experienced on the go.
NVIDIA is belligerently focusing toward VR division. VR is a small but swiftly escalating market –Â gaming –Â and NVIDIA is facilitating to escort in it by enhancing its laptop-based GPUs.
As a matter of fact, NVIDIA’s graphics cards with substantial performance (near desktop level) could help inspire VR hardware as well as software sales. Not only this, but more OEMs will be encouraged to build VR-supported PCs.
Gamers are eagerly waiting for the graphics cards manufacturing companies to launch laptop graphics comparable to the performances of their desktop graphics. However, NVIDIA is well aware of this and is working hard to produce more powerful and efficient GPUs.
Deep learning
At present, the driverless cars market has become one of the most high-growth segments. Therefore, NVIDIA is belligerently placing its attention on deep learning as it plays a major role in cloud computing as well as driverless cars.
Most recently, NVIDIA’s rival Intel (INTC, Financial) detailed that its new Knights Landing Xeon Phi processors are superior compared to NVIDIA’s GPUs. Conversely, NVIDIA replied that Intel has made several mistakes regarding developments in the software as well as hardware.
Furthermore, the company detailed that the data used by Intel is approximately 1½ years old. The company said this because its Maxwell GPUs are built on new data and in reality are 30% faster compared to Intel’s Xeon Phi.
Moving onward, the company also detailed that its new Titan X server grounded on new Pascal architecture is approximately two times faster compared to Intel’s new processors. All these offerings should benefit NVIDIA going forward, which is why I am bullish on the stock.
Conclusion
Despite the recent rally, NVIDIA has upside to offer. Due to the company’s diversified business model, its strong growth will continue.
Disclosure: I don't hold a position in any of the stocks mentioned in the article.
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