"NVIDIA: “Expensive and Worth It,” Says MKM Partners" (NVDA)

We don't do much individual stock stuff on the blog but this one is special.
We use it as an example of what Silicon Valley used to be, when high tech meant high technology and not a new app for some (still) mundane task.

Simply put, NVIDIA makes some of the fastest computer chips in the world.
They are used in gaming systems that require graphics that don't  make you (literally) puke. Right now automakers use their chips for graphic displays.

The future: Robocars? May 2015: "Nvidia Wants to Be the Brains Of Your Autonomous Car (NVID)":

Among the fastest processors in the business are the one's originally developed for video games and known as Graphics Processing Units or GPU's. Since Nvidia released their Tesla hardware in 2008 hobbyists (and others) have used GPU's to build personal supercomputers.
Here's Nvidias Build your Own page.
Or have your tech guy build one for you.

In addition Nvidia has very fast connectors they call NVLink.
Using a hybrid combination of IBM Central Processing Units (CPU's) and Nvidia's GPU's, all hooked together with NVIDIA's NVLink, Oak Ridge National Laboratory is building what will be the world's fastest supercomputer when it debuts in 2018.

As your kid plays Grand Theft Auto.... 

 We last looked at them in October 10's "Quants: "Two Glenmede Funds Rely on Models to Pick Winners, Avoid Losers" (NVDA)". The stock closed that day at $26.07.

From Barron's Tech Trader Daily:

Car makers and video games helped visual computing chipmaker Nvidia‘s (NVDA) push fiscal third-quarter financial results past expectations Thursday, and led MKM Partners to upgrade the stock to a Buy.

“Expensive and worth it,” read the headline on the note penned by analyst Ian Ing, who earlier this week had cautioned investors on the stock’s valuation. Now he sees the stock climbing to $36.
As Ing writes today:

NVDA commands some of the highest earnings multiples in semiconductors and is the highest in our coverage. Our applied multiple (24.3x) is near the four-year historical high (26.9x). However, we believe this multiple is reasonable in the context of NVDA seeing “very large markets” and its TAM opportunity having “never been greater.” For example, machine learning could become a $3B+ opportunity should it grow to 30%-40% of the $10B server chip market.

Nvidia’s share price soared $3.91, or $14.16% to $31.63 in late morning market action.
In the quarter ended Oct. 25, Nvidia earned 46 cents a share as revenue rose 6.5% to $1.305 billion. Analysts expected earnings of 35 cents a share on revenue of $1.18 billion, according to FactSet....MORE

Here's the recent action, note top right:

 FinViz

It might close the gap up, they often do.
It might not.