It seems like the worst may be over for NVIDIA’s stocks, as last month the company’s stocks rose steadily by exactly 16.4% after a rough 5 months or so. In August 2018, team green’s stocks rose to an all-time high of US$281, but shortly afterward fell to their lowest ($133) in the past decade. This was the result of panicking investors selling off their shares in the aftermath of the cryptocurrency hangover.
At the beginning of this year, NVIDIA held a press conference for investors and assured stock-holders that there’s nothing to worry about by showing recent stats that indicated an increase in the sales of the Turing GPUs compared to Pascal, as well as a much higher Max-Q notebook adoption. This was followed by the company’s recent acquisition of Mellanox (maker of smart interconnect solutions for servers and data-centers) for a mammoth $6.9 billion. This apparently made a lot of people happy, as the company’s stocks rose sharply after the acquisition was announced.
NVIDIA shares grew by 7% on the same day and the upward trend continued culminating in a 12.7% gain by the end of the week. There are two main reasons for this:
- Firstly, both companies are key players in the data center and high-performance computing (HPC) sector. with NVIDIA’s computing platform and Mellanox’s interconnect powering more than 250 of the fastest 500 supercomputers around the world.
- Secondly, the initial financial impact of the deal looks good. NVIDIA said that post-close, “the transaction is expected to be immediately accretive to [its] non-GAAP gross margin, non-GAAP earnings per share and free cash flow.”
Read more:
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- Borderlands 3 will be Built from the Ground up For AMD Navi GPUs and Ryzen CPUs
Source: TheMotleyFool