Nvidia (NVDA) Rockets on Unknown Fuel

Shares of Nvidia (NASDAQ:NVDA) have been trading up over 8 percent for most of the session, with no known impetus for the strong move.

Barron's Tiernan Ray offers several possibilities:

"One is short-covering after a dive from the mid-$20s in a little over a month. Such short covering would perhaps be part of a general rebound in stocks of companies tied to the tablet computing markets, where the unveiling of Apple’s (AAPL) iPad 2, and a fear of a glut in tablets, had lately caused some players to swoon, including Nvidia.

"However, there are some potential news pegs as well. Craig Ellis with Caris & Co. points to two pieces in trade publication DigiTimes today that may be helping the stock.

"One is an article by Yen-Shyang Hwang and Willie Teng stating that AT&T (T) will carry Acer’s “Iconia” tablet, starting in Q2, using the Nvidia’s “Tegra 2″ processor. Acer expects it will ship 5 million to 7 million tablet computers this year, Hwang and Teng report. Ellis observes that such a number is encouraging, following reports a couple weeks back that the “second-tier” tablet makers such as Acer were scaling back their tablet plans.

"The other piece is a report by Yenting Chen and Steven Shen citing remarks by touch panel manufacturer J Touch, stating that the market for non-Apple tablet computers will be bigger this year than people are currently expecting. The company plans to double manufacturing capacity in the second half of this year from roughly 5.5 million units per month at present, the authors report."

Nvidia was trading at $19.25, gaining $1.44, or 8.09 percent, as of 1:48 PM EDT.




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