Short nVIDIA and go long equal $ amount of S3 and/or 3dfX --a high probability winning trade. Why would someone pay 39 times book value (0.51c per profile in Yahoo stock quote section) for nVIDIA and only 1.5 times book for S3 or 3DFX, the latter being a direct successful competitor in what is now a mature cutthroat margin industry.Right now the stock is still atleast 2.5 to times the $7 price at which the underwriters originally planned to release the IPO at. This is a good target price for the downside. Even if both stocks sink it will be a winning trade because S3 or 3dFX, both at close to their lows,will fall much less.
Right now the nVDA stock is high from the afterglow and hype of the IPO but board shipments of their latest flagship product the RIVATNT has slowed and customers are now extracareful to not order anymore of the TNT's in anticipation of the next TNT2 version. A lot of preIPO stock is sitting with the Venture Capitalist and once they get a chance to unload after the cooling period watch out.
Be prepared for 2ndQ earnings that are way down from the 4Q99 earnings!Ignore this at your own risk.