Friday musings
In Wednesday's early trading the share price of Imagination Technologies (IMG) hit an all-time high of 670p per share. The share price continues to rise on the back of its success in contract and partnership wins in the IT sector. The particular strength of IMG is in the mobile graphics capability demanded by today’s mobile tech enthusiasts, and buying into IMG was one of Intel's more astute investments.
Most of the headlines linked to PowerVR chips have come from the graphics processors in Apple mobile products and most recently the new iPad, which was announced with “Quad-Core graphics” aka the PowerVR SGX543MP4, also used in the PlayStation Vita. In the special presentation a week ago Apple’s Tim Cook repeatedly referenced the fantastic graphics capability of the new iPad with 1080p video output.
If you look at the specs of that device the core processor remains the same type and speed (A5 at 1GHz) so we could say most of the new power and features of the iPad are derived from the PowerVR chip. Early benchmarks of the iPad 3 show the CPU to have very similar performance to iPad 2.
Competitor mobile graphics chips don't seem to be able to compete in achieving the balance between power requirements (important to battery life), speed and price. One of the closest competitors in mobiles and tablets is the NVIDIA Tegra 3, which is a very capable quad-core chip found, for example, in the ASUS Transformer Prime. However, Apple's Tim Cook boasted that the PowerVR chips in the new iPad have 4x the performance of the Tegra 3, though the claim has been thoroughly questioned by NVIDIA. Details of other mobile graphic competitors can be found here, most importantly ARM's Mali-400, as used in the Samsung Galaxy S2. ARM is planning a successor; the Mali-T658, with 10X performance!
IMG has a lot of other partners in the mobile graphics sector including Samsung, Ti, LG and Sony, so all the eggs aren't in one proverbial basket. If it can keep hold of its partners, keep up to speed and continue to innovate in the face of competition from ARM and NVIDIA, among others, then Imagination's stock is a strong candidate to rise further. But as we all know there is no certainty in life except for death and taxes (and NDAs - ed).
What do you think? Is IMG a rising star?
