Graphics chip maker NVIDIA (Nasdaq: NVDA) recently received a ratings boost from Canaccord Genuity. The company upgraded NVIDIA's stock from a hold to a buy. So, is this a good enough reason to stock up on NVIDIA at current levels? Let's take a closer look.

Well, for a start, NVIDIA is one of the few companies that is enjoying more demand than it can handle. Its newest 28-nanometer Kepler-based GPUs, which find a prominent place in next-gen notebooks where Intel's (Nasdaq: INTC) Ivy Bridge chips also factor prominently, are being manufactured by foundry partner Taiwan Semiconductor Manufacturing (TSMC). Unfortunately, TSMC has been unable to ramp up production because of certain difficulties it's been facing with the 28-nanometer based chip production line. And NVIDIA is certainly not alone: Peer Qualcomm, whose Snapdragon S4 chip has generated a lot of interest from OEMs, has also been on the receiving end of TSMC's production issues.

Coming back to NVIDIA, business has been brisk for its precious few Kepler GPUs, with Apple (Nasdaq: AAPL) having selected them for its new line of MacBook laptops. On the other hand, Microsoft's (Nasdaq: MSFT) recently launched Surface tablet would be also be using another NVIDIA offering-its Tegra 3 processor, which incidentally is a 40-nanometer process-based chip. That should ensure that the Tegra 3 remains unaffected by TSMC's production issues.

NVIDIA is also slated to release its very own Tegra 3 Icera baseband chips by the first half of next year. With Qualcomm currently facing problems with its 28-nanometer LTE baseband chips, NVIDIA can take advantage of the situation and boost sales of its Icera baseband products.

The Foolish bottom line
NVIDIA does have a solid financial standing with more than $3 billion in total cash and equivalents on its balance sheet. Add to that debt amounting to a meager $20 million, and you have a relatively solid company with fairly decent fundamentals.

To add NVIDIA to your free watchlist, click here.

NVIDIA might be just one good way to ride the growth stocks that look poised to generate strong returns for investors going forward. But there are more opportunities waiting for your attention. I suggest you read the Fool's recent research report on another major source of growth in technology -- social networking. Especially with the noise surrounding Facebook, the best stock in the sector might surprise you. Just click here now to find out which stock we think has the brightest future.