Cowen Starts NVIDIA (NVDA) at Outperform

June 25, 2008 9:27 AM EDT

Cowen & Co. initiates coverage on NVIDIA (Nasdaq: NVDA) with an Outperform rating.

The firm believes that investors have lost sight of the big picture, and are only focusing on near-term concerns. Cowen feels NVIDIA has positioned itself for an attack on the mainstream computing market "from all sides", "clearing a path for significant EPS growth and stock appreciation over the next few years."

While Soleil does believe near-term concerns are valid, the firm also mentions that at current levels, the market is likely already discounting these issues. The firm notes that NVIDIA's current valuation of 13x it's CY09 GAAP EPS estimate is well below its historical range.

Soleil is estimating an EPS CAGR of 20% over the next several years. Specifically, the firm sees FY09 EPS of $1.25 and FY10 EPS of $1.50. The Street estimates are currently $1.58 and $1.80 for FY09 and FY10, respectively.

NVIDIA Corporation provides visual computing technologies designed to generate interactive graphics on consumer and professional computing devices in the United States and internationally.

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