2006 price change: +98.1%
Despite getting ensnared in the stock options backdating scandal and enduring a rough year for the chip sector overall, shares of the graphics chip maker have nearly doubled this year. The company’s chips are used in everything from gaming consoles like the PlayStation 3 to Motorola's Razr phone.
The stock has been on a tear since July, when AMD said it was buying rival graphics chip maker ATI Technologies. That tie-up has fueled speculation that a partnership of some sort will eventually spring up between Nvidia and Intel.
2007 outlook: While Intel is likely to make its way into high-end graphics processors, that doesn’t necessarily mean the company will seek a union with Nvidia. After the big run-up in 2006, it may be difficult for the stock to match this year’s performance.
Furthermore, just as the company finished an internal review of its stock option grants, it came under the scrutiny of the Department of Justice, which is investigating potential anti-competitive practices in the graphics chips industry.