The Buzz

All markets and investing news all the time

Stupid Stock Move of the Day! Nvidia up 7%?

June 19, 2012: 3:03 PM ET

On the Surface, Microsoft's (MSFT) new tablet is a boon for graphics chipmaker Nvidia (NVDA). But I'm a little surprised the stock is up this much on the news. Considering that we don't yet know when the Surface will ship -- or more importantly how well it will fare in the market against the Apple (AAPL) juggernaut -- it seems that investors are taking a huge leap of faith to boost Nvidia this much today.

Shares of other Surface chip-suppliers, most notably Intel (INTC) and ARM Holdings (ARMH) were not up nearly as much as Nvidia. And following Tuesday's big bump, Nvidia now trades at about 18 times fiscal 2013 earnings estimates. That's a bit pricey for a semiconductor stock.

Sure, Nvidia has more to it than Microsoft. But the stock is up today mainly on Mister Softee tablet hopes. Microsoft didn't let the press play too much with the Surface prototypes Monday night. My colleague David Goldman was intrigued by the device.

But considering that you could make the strong case that Microsoft's hardware track record is mixed (to put it kindly ... some would say that Microsoft's only hardware success stories are the Xbox and Kinect) would it be a huge surprise if Surface (like just about every other tablet out there not named iPad) fails to catch fire with consumers?

Join the Conversation
Fear & Greed
Sponsored by
About This Author
Paul Lamonica
Paul R. La Monica
Assistant Managing Editor, CNNMoney

Paul R. La Monica is an assistant managing editor at CNNMoney. He is the author of the site's daily column, The Buzz, and also tweets throughout the day about the markets and economy @LaMonicaBuzz. La Monica also oversees the site's economic, markets and technology coverage.

To view my watchlist

Not a member yet?

Sign up now for a free account
Stupid Stock Move of the Day
#StupidStock Moves of the Day! Ebola is scary. But airline sector sell-off is overly emotional. Nothing to suggest people will stop flying.
Powered by WordPress.com VIP.
Follow

Get every new post delivered to your Inbox.

Join 242 other followers