As most of Wall Street continues to spout a seemingly endless stream of Q1 2007 news, graphics chip maker NVIDIA (NASDAQ:NVDA) has already wrapped fiscal 2007 and is moving on to 2008. Q1 results for its new fiscal year are due out Thursday.

What analysts say:

  • Buy, sell, or waffle? Twenty-five analysts play NVIDIA, giving it 13 buy ratings, 10 holds, and a pair o' sells.
  • Revenue. Analysts expect to see 23% sales growth to $835.7 million.
  • Earnings. Profits are predicted to fly even higher, up 34% to $0.39 per share.

What management says:
Three months ago, my fellow Fool Anders Bylund exclaimed in wonderment over NVIDIA's 39% year-over-year growth in earnings, but cautioned: "Some of the net income growth is illusory, however, since NVIDIA took a full year's worth of R&D tax credits in this quarter. That isn't likely to happen again." Indeed, this time around, the pundits are projecting a 34% boost in profits. Likewise with revenue, which looks set to slow sequentially this quarter.

That shouldn't detract, however, from the fact that NVIDIA turned in a "record year" (as CEO Jen-Hsun Huang put it) in fiscal 2007.

What management does:
Lots of companies claim "record" quarters and years, but few post the kinds of numbers we see below -- six straight quarters of improvement at every level of profitability, with rolling gross, operating, and net margins all heading upward, ever upward.

Margins

10/05

1/06

4/06

7/06

10/06

1/07

Gross

36.7%

38.5%

40.0%

41.2%

41.6%

43.2%

Operating

12.9%

15.1%

16.2%

17.2%

18.0%

19.6%

Net

10.4%

12.7%

13.2%

13.2%

13.6%

14.6%
All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
Reviewing NVIDIA's progress back in the January issue of Motley Fool Stock Advisor (containing our most recent round of six-month checkups on past recommendations), Fool co-founder David Gardner predicted "a strong 2007" for the company, driven by the twin impetuses of a Microsoft (NASDAQ:MSFT) Vista-fueled upgrade cycle in PCs, and more sales of Sony's (NYSE:SNE) PlayStation 3 gaming console. Thus, David sees no need for the rumors of an Intel (NASDAQ:INTC) bid for NVIDIA -- to counter AMD's (NYSE:AMD) buyout of ATI Technologies -- to help this stock to grow. He thinks NVIDIA can do just fine all on its lonesome, thank you very much.

That said, David does have an opinion on what price investors should pay to participate in that growth. To find out what it is, you'll need to read the January edition. And to do that, you'll need access to the Stock Advisor service. Hmm. How about we offer you a free one-month trial? Click here to claim it.

Fool contributor Rich Smith owns shares of Intel. The Fool has a disclosure policy.