NVIDIA Shares Jumped: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Graphics chip maker NVIDIA (NAS: NVDA) rose 10% today after the company was upgraded by an analyst.

So what:Wells Fargo (NYS: WFC) analyst David Wong changed his rating on NVIDIA to outperform from market perform. He sees the company's significant risks priced into the stock and thinks the upside potential is attractive at the stock's current price.

Now what: We Fools don't like to take analyst ratings too seriously, but Wong may actually have a point here. NVIDIA has a P/E ratio of just under 15 -- even after today's pop -- and the business is growing on the back of tablet and smartphone sales. If Tegra can be a blockbuster, NVIDIA may be a home run for investors.

Interested in more info on NVIDIA? Add it to your watchlist.

At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.The Fool owns shares of and has created a ratio put spread position on Wells Fargo. Motley Fool newsletter services have recommended buying shares of NVIDIA, as well as writing puts in NVIDIA. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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