NVDA vs. XPER: Which Chip Stock Should You Pick in 2023?

NASDAQ: NVDA | NVIDIA Corp. News, Ratings, and Charts

NVDA – The semiconductor industry is expected to thrive in the coming years amid the rapidly growing use of AI and the metaverse. Given the favorable growth prospects of the sector, quality chip stocks NVIDIA (NVDA) and Xperi (XPER) are expected to witness solid gains. But which stock should you pick in 2023? Let’s find out…

The semiconductor industry witnessed significant logistic disruptions in 2022. Moreover, the industry has been under pressure with declining demand. However, Barclays Capital Inc. analysts don’t expect the sector to revisit multi-year lows reached three months ago.

While the industry has been struggling with macro headwinds, its long-term prospects look impressive. Amid the metaverse’s surging popularity, semiconductor and chip producers are slated to be the biggest gainers. According to an Accenture report, 67% of executives believe semiconductors are the most critical technology for the metaverse industry.

Furthermore, the global artificial intelligence chip market is projected to grow at a CAGR of 37.1% until 2031. So, NVIDIA Corporation (NVDA) and Xperi Inc. (XPER) are expected to gain substantially in the near future. NVDA and XPER are popular chip makers operating globally.

NVDA has gained 41.9% over the past month, while XPER has gained 16%. In addition, NVDA has gained 49% over the past three months, while XPER has lost 8.4%.

Which stock is a buy? Let’s find out.

Latest Developments

On January 3, 2023, NVDA and Hon Hai Technology Group (Foxconn), the world’s largest technology manufacturer, announced a strategic partnership to develop automated and autonomous vehicle platforms. This partnership is expected to be a new chapter in innovative electric vehicle development.

On the other hand, on January 5, 2023, XPER announced its partnership with LG Electronics to integrate DTS: X® immersive audio technology into LG’s latest OLED and Premium LCD TVs.

Jea Yoo, president of Korea at XPER, said, “DTS is enabling a new level of audio experience, bringing the quality sound consumers expect in a theater to the home. We’re excited to help transform the listening experience of LG TV users.”

Recent Financial Results

NVDA’s revenue came in at $5.93 billion for the third quarter that ended October 30, 2022, down 16.5% year-over-year. Its gross profit came in at $3.18 billion, down 31.4% year-over-year. Also, its net income came in at $680 million, down 72.4% year-over-year, while its EPS came in at $0.27, down 72.2% year-over-year.

On the other hand, XPER’s revenue came in at $121.64 million for the third quarter that ended September 30, 2022, up 3.3% year-over-year. Its cash and cash equivalents came in at $180.12 million for the period that ended September 30, 2022, compared to $120.69 million for the period that ended December 31, 2021.

Past and Expected Financial Performance

NVDA’s revenue is expected to decline 21.4% year-over-year to $6.01 billion for the yet-to-be-reported quarter ending January 2023. However, its revenue is expected to increase 8.8% year-over-year to $29.29 billion in 2024. Its EPS is estimated to decrease 26.6% year-over-year to $3.26 for 2023 and increase 31.6% year-over-year to $4.29 in 2024.

On the other hand, XPER’s revenue is expected to increase 6.3% year-over-year to $529.21 million in 2023. Its EPS is expected to increase 89.6% year-over-year for the same period. Moreover, its EPS is expected to rise 15% per annum for the next five years.


NVDA’s EBITDA and net income margin of 30.52% and 20.85% are higher than XPER’s negative 8.47% and 104.22%. Also, its ROE of 26.39% compares with XPER’s negative 17.09%. However, XPER’s 74.91% gross profit margin is higher than NVDA’s 57.84%.


In terms of forward EV/Sales, XPER’s 0.70x is lower than NVDA’s 19.23x. Its trailing-12-month Price/Sales of 0.88x is 95.2% lower than NVDA’s 18.45x. Moreover, XPER’s trailing-12-month Price to Book ratio of 0.58x compares with NVDA’s 24.39x.

Thus, XPER is relatively more affordable.

POWR Ratings

XPER has an overall rating of A, equating to Strong Buy in our proprietary POWR Ratings system. On the other hand, NVDA has an overall rating of D, which translates to Sell. The POWR Ratings are calculated considering 118 different factors, with each factor weighted to an optimal degree.

XPER has a B grade for Growth, consistent with its steady financials in the latest reported quarter. On the other hand, NVDA has a D grade for Growth, consistent with its bleak financials in the latest reported quarter.

In addition, XPER has a B grade for Sentiment, in sync with favorable analyst expectations. On the other hand, NVDA has a C grade for Sentiment, in sync with mixed analyst expectations.

Of the 92-stock Semiconductor & Wireless Chip industry, XPER is ranked #3, while NVDA is ranked #80.

Beyond what we’ve stated above, we have also rated the stocks for Growth, Value, Momentum, and Sentiment. Click here to view XPER’s Ratings. Get all NVDA ratings here.

The Winner

Semiconductor demand is poised to grow due to its varied usage across emerging industries like the metaverse and AI. Therefore, quality stocks XPER and NVDA should benefit. However, XPER’s higher growth and attractive valuations make it the better buy here.

Our research shows that the odds of success increase when one invests in stocks with an Overall Rating of Strong Buy or Buy. View all the top-rated stocks in the Semiconductor & Wireless Chip industry here.

Consider This Before Placing Your Next Trade…

We are still in the midst of a bear market.

Yes, some special stocks may go up. But most will tumble as the bear market claws ever lower.

That is why you need to discover the brand new “Stock Trading Plan for 2023” created by 40-year investment veteran Steve Reitmeister. There he explains:

  • Why it’s still a bear market
  • How low stocks will go
  • 9 simple trades to profit on the way down
  • Bonus: 2 trades with 100%+ upside when the bull market returns

You owe yourself to watch this timely presentation before placing your next trade.

Stock Trading Plan for 2023 > 

NVDA shares rose $3.38 (+1.60%) in premarket trading Tuesday. Year-to-date, NVDA has gained 44.31%, versus a 7.16% rise in the benchmark S&P 500 index during the same period.

About the Author: Riddhima Chakraborty

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries. More...

More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
NVDAGet RatingGet RatingGet Rating
XPERGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com

When is the Stock Bounce Coming?

Higher bond rates have been the main catalyst behind lower stock prices. Yet with the S&P 500 (SPY) pressing down towards the 200 day moving average we are all wondering when stocks will finally bounce. Steve Reitmeister reviews the facts in hand to help investors navigate the choppy investment waters. Read on below for the full story...

These 2 Stocks are Both Clean and Green

Recession is imminent, no recession on the horizon, a soft landing…or small recession…has been the constant and contradictory litany flowing from Wall Street the past year. The combination of interest rates and oil both spiking recently certainly lends credence to some form of recession in 2024. Stocks that have some recession proofing built in, like Clean Harbors (CLH) and Concrete Pumping Holdings (BBCP) definitely deserve a look at this point.

With Oil Soaring, My Under $10 Stock of the Week

The number of oil rigs in the U.S. and Canada has decreased by 170 over the past year. International oil suppliers are cutting output. This opens the door to small oil and gas exploration and development companies like Baytex Energy (BTE).

Income Stock of the Week: Deluxe Corporation (DLX)

Picks and shovels plays are always a great go to area for income because they provide the necessary means for any business to operate. And business operations management is a great way to gain leverage, using a software-based platform that can scale your proverbial picks and shovels. Deluxe Corp (DLX) is a great example of a company executing this model and generating high margins in return.

2024 Stock Market Outlook

The time to think about the 2024 stock market is now. Will it be a bull or bear? Where does the S&P 500 (SPY) end the year? And what are the top picks to outperform? Investment veteran Steve Reitmeister does his level best to answer all these questions. Just read on below...

Read More Stories

More NVIDIA Corp. (NVDA) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All NVDA News