A Chip Stock With Upside (ENTR)

With consumers flocking to digital media services like Netflix (NASDAQ: NFLX) as a way to get their TV/movie fix, the home entertainment network is gaining traction. The way HD video, music, games and photos are brought into a home has been completely revolutionized in just a few short years. Commanding nearly an 80% market share for the semiconductors that make this new home media network possible, Entropic Communications (NASDAQ: ENTR) hasn't yet grabbed the attention of the herd.

The company's MoCA (multimedia over coax alliance) technology has changed how DVR's and IPTV video delivery services are transferred throughout the house. With more people using services like Hulu and with Google (NASDAQ: GOOG) looking to enter the internet TV market, Entropic's growth story is just beginning.

Shares of the fabless semiconductor company trade for a dirt cheap P/E of 11 and a PEG of 0.65. The company also recently reported a 90% increase in revenues due to the strength of the connected home entertainment market. With a market cap of only $800 million, the company is great contender for a buy-out as well.

As we enter an era of Smart TV Entertainment, Entropic could be one of the best bets in the semi industry. Investors may want to grab this one before industry insiders do.