Do You Have These Semiconductor Stocks On Your Watchlist?
Semiconductor stocks have been on the radar of many investors in the stock market over the past couple of years. After all, companies within the industry have seen an exponential increase in revenue during the pandemic as digital transformation accelerated. For starters, this could be thanks to the rollout of 5G and the accelerated efforts of the automotive industry toward electric vehicles.
Other factors were also at play for investors looking for top semiconductor stocks to buy. This includes a persistent shortage of semiconductors in the past two years, partly thanks to supply chain issues. And that has pushed semiconductor prices higher. This translates to bigger profits for the chip manufacturers.
With that in mind, many analysts believe that the semiconductor industry could outperform the broader market this year. For instance, Wedbush analyst Matt Bryson seems to be bullish on Micron Technology (NASDAQ: MU). Accordingly, the analyst raised his rating on Micron shares from ‘Neutral’ to ‘Outperform’, with a new price target of $120 up from $100. Elsewhere, Nvidia (NASDAQ: NVDA) is set to report its fourth-quarter results Wednesday after the closing bell. Seeing that Nvidia is among the leading names in the industry, it is not surprising that many investors are anticipating the release. Considering that the tailwind could remain throughout 2022, here are four other semiconductor stocks to watch in the stock market today.
Top Semiconductor Stocks To Buy [Or Sell] This Week
- Tower Semiconductor Ltd (NASDAQ: TSEM)
- Advanced Micro Devices Inc. (NASDAQ: AMD)
- ON Semiconductor Corporation (NASDAQ: ON)
- Taiwan Semiconductor Manufacturing Company (NYSE: TSM)
Tower Semiconductor
Tower Semiconductor is an Israeli-based leading foundry of high-value analog semiconductor solutions. For the most part, it manufactures advanced analog integrated circuits using specialty process technologies. In fact, Tower leads the analog ecosystem, bringing high-quality, innovative manufacturing solutions in various growing markets. The company provides solutions in industries such as the automotive, industrial, and medical industries.
Just yesterday, it was reported that Intel (NASDAQ: INTC) is close to buying the semiconductor firm for about $6 billion, according to a source familiar with the matter. This is a strategic play on Intel’s part as it bolsters a plan to make more chips for other companies. It was also reported that the deal could be unveiled as soon as this week.
As such, if the deal goes through, it will deepen Intel’s presence in the semiconductor space. Besides the takeover, Tower will also be reporting its fourth-quarter and full-year financials on February 17. Analysts are estimating earnings of $0.47 per share, an increase from the third quarter’s $0.41. All things considered, will you be keeping an eye on TSEM stock?
[Read More] Good Stocks To Buy Right Now? 5 Reopening Stocks In Focus
Advanced Micro Devices
Next up, we have Advanced Micro Devices, or AMD for short. The chip titan essentially produces high-performance computing, graphics, and visualization technologies. With over half a century of experience in the semiconductor industry, the company continues to be a pioneer of innovation with its highly advanced processors and technologies. As a matter of fact, the company’s products and services are used by hundreds of millions of consumers globally.
On Monday, AMD finally closed on its $35 billion acquisition of Xilinx. This marked the largest transaction in AMD’s 53-year history and gives the company significant expertise in the programmable chip market. Hence, the company, in theory, should now have an extended hand in taking away market share from competitors. Particularly, in areas such as cloud computing workloads and data centers. AMD CEO Dr Lisa Su struck an upbeat tone on what the acquisition could mean from the company’s top and bottom lines.
She said, “This acquisition is accretive in the first year for gross margins, for earnings per share and for free cash flow. It’s a good deal overall. And when we look at growth rates, what we said at the time of the acquisition is that we felt we could grow significantly ahead of the industry — 20% plus for the next few years. And we still believe that’s the case,” With this positive sentiment from the CEO, do you think AMD stock is worth the buy?
ON Semiconductor
Another top semiconductor stock to keep tabs on is ON Semiconductor, also known as Onsemi. The company is driving energy-efficient innovations to empower customers to reduce global energy use. Onsemi boasts a wide portfolio of offerings including sensors, power management, SoC, analog, and logic devices to name a few. ON stock performed well over the past year, with its stock price rising by about 40%.
Last week, the firm reported its fourth quarter and fiscal 2021 results. The company brought in a record revenue of $1.85 billion for the quarter, up from the prior year’s $1.45 billion. Moving on, the company earned $425.9 million, a vast year-over-year increase from $89 million.
The company cites a focus on secular megatrends such as electric vehicles, alternative energy, and industrial automation as a driver of these profits. Moreover, it continues to expand gross margins by shifting its mix. Namely, by getting into high-value strategic markets while making new products, rationalizing manufacturing footprint, and improving cost structure. Given the strong quarter, is ON stock worth a spot in your portfolio?
[Read More] Best Stocks To Invest In 2022? 4 Gaming Stocks For Your List
Taiwan Semiconductor Manufacturing Company
Taiwan Semiconductor Manufacturing Company (TSM) is one of the largest semiconductor companies in the world. Put simply, the company manufactures and sells integrated circuits and semiconductors. On top of that, the company also offers customer service, account management, and engineering services. In addition, TSM also owns and operates the largest semiconductor design ecosystem globally, the Open Innovation Platform. Its clients include big names in tech such as Apple (NASDAQ: AAPL) and Nvidia.
Recently, the semiconductor titan reported its fourth-quarter results. Jumping right in, the company reported a revenue of approximately $15.7 billion, a substantial increase of 21.2% year-over-year. Moving on to its net income, the company raked in $5.97 billion for the quarter, an increase of 16.4% from the year before.
Earnings aside, the company is planning to spend as much as $44 billion to bump up its manufacturing capabilities. This indicates a budget increase of almost 50%. This is because TSM predicts a multi-year industry megatrend for strong chip demand, boosted by AI, 5G, and the need for high-speed silicon in electronics. With much in store for the company, do you think TSM stock is worth watching?
If you enjoyed this article and you’re interested in learning how to trade so you can have the best chance to profit consistently then you need to checkout this YouTube channel. CLICK HERE RIGHT NOW!!
