Stocks: (AMD)(INTC)(NVDA)
Nvidia, the graphics chip maker, has received a subpoena from Justice regarding potential antitrust activity in the graphics chip and processing cards.
AMD is part of the probe as well. They bought graphics chip company ATI Technologies, which would appear to be the target of the investigation.
Nvidia is trading very near its 52-week high, so it may not take much to get its shareholders nervous.
The action by Justice would seem to contradict the wall that Wall St. sees the graphic chips market. As Morningstar points out "intense competition and the lack of an economic moat make these shares appropriate only for investors with strong stomachs for volatility"
Given that companies like AMD and Intel are competing with NVDA, it would seem that anticompetitive practices would be hard to come by
But, this author is not a lawyer.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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