NVIDIA's Long-Term Prospects Mean It's Currently Undervalued

Despite having execution problems and ferocious competition (detailed in my last article), I still think NVIDIA Corp. (NVDA) will still be at least moderately profitable in the long-term, and the 30% drop in its stock price following one bad quarter is an over-reaction. NVDA has several factors in its favor.

NVDA is unlikely to lose market share, and might even gain some share. Both technological and market factors account for this. Technologically, GPU chips are second only to CPUs in complexity, meaning that competition from Asian fabs are unlikely, and the only competition is likely to remain ATI/AMD and Intel (INTC).