Are These The Best Stocks To Buy For 2022?
Semiconductor stocks, arguably, remain viable plays in the stock market now. This would largely be in thanks to the strong demand for semiconductor chips. Evidently, a Gartner (NYSE: IT) report notes that semiconductor revenue grew 25.1% globally in 2021, exceeding $500 billion for the first time. One of the reasons that could explain this growth would be the increase in remote-working due to the pandemic. This, in turn, boosted demand for PCs and laptops significantly. Even now, companies are already extending their work-from-home policies as COVID-19 cases in the U.S. remain high. For this reason, semiconductor stocks could continue to benefit.
Last week, we saw Qualcomm (NASDAQ: QCOM) announce stellar results for its first quarter fiscal. Notably, the semiconductor company raked in a record revenue of $10.7 billion and earnings per share of $2.98, both of which were up 30% and 41% respectively year-over-year. Elsewhere, Texas Instruments (NASDAQ: TXN) saw its latest quarter revenue increase by 19% from a year ago, mainly driven by strong demand in industrial and automotive markets. Along this was a net income of $2.14 billion, up by 26% year-over-year. Some would argue that the earnings release from these two semiconductor giants testifies to the solid growth in the semiconductor space. With that being said, do you have this list of top semiconductor stocks to watch in the stock market today?
Best Semiconductor Stocks To Buy [Or Avoid] For 2022
- Qorvo (NASDAQ: QRVO)
- Advanced Micro Devices Inc. (NASDAQ: AMD)
- Intel Corporation (NASDAQ: INTC)
- Taiwan Semiconductor Manufacturing Company (NYSE: TSM)
Qorvo
Starting us off is Qorvo, a semiconductor company that mainly designs, manufactures, and supplies products for wireless and wired connectivity worldwide. Qorvo operates through two segments, Mobile Products and Infrastructure and Defense Products. For the most part, these include radio-frequency systems for applications that drive wireless and broadband communications, as well as foundry services. The company sells its products directly to original equipment manufacturers (OEM) and original design manufacturers, as well as through a network of sales representative firms and distributors.
Last Wednesday, Qorvo announced its fiscal 2022 third-quarter results. Diving in, on a GAAP basis, total revenue for the quarter came in at $1.11 billion. As for its net income, that number came in at about $216.2 million, a 7.57% increase compared against the year before. Accordingly, diluted earnings per share were $1.95, or up by about 12% year-over-year.
CEO of Qorvo Bob Bruggeworth attributes this sustained revenue growth to multi-year secular growth drivers in 5G, Internet-of-Things (IoT) connectivity, defense, and power. Moreover, the company is aiming to expand its addressable market whilst innovating to extend its leadership across its product and technology offerings. With that being said, would you add QRVO stock to your watchlist?
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Advanced Micro Devices
Advanced Micro Devices, commonly known as AMD for short, is a semiconductor company that produces high-performance computing, graphics, and visualization technologies. With over 50 years of experience in the industry, the company continues to drive innovation in its realm of processors and technologies. In fact, its products and services are used by hundreds of millions of consumers globally. In the past year, AMD stock has grown by about 35%. Recently, AMD reported its fourth-quarter financials.
Getting into it, the company brought in a record quarterly revenue of $4.8 billion, an impressive increase of 49% year-over-year. Notably, this growth in revenue was driven by higher revenue in its computing and graphics segment which stood at $2.6 billion for the quarter, or up by 32% compared to a year ago.
Besides that, net income for the quarter was $974 million and diluted earnings per share was $0.80. The company also ended the quarter with $3.6 billion in cash and cash equivalents. AMD also shared its financial outlook for the year. Namely, it expects revenue to be approximately $21.5 billion, an increase of approximately 31% over last year. All in all, do you think AMD stock is worth investing in now?
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Intel
In short, Intel engages in the design, manufacture, and sale of computer products and technologies worldwide. Also, it is one of the world’s largest semiconductor chip manufacturers by revenue. Intel supplies microprocessors to computer manufacturers which include the likes of Dell (NYSE: DELL) and HP (NYSE: HPQ). Recently, Intel announced that it will be taking Mobileye public. In brief, Mobileye is a market leader in driver-assistance and autonomous driving solutions. Intel will remain the majority owner of Mobileye and will continue to co-develop technologies together.
Besides that, on January 26, Intel reported its fourth-quarter earnings. GAAP revenue was $20.5 billion, exceeding its own October guidance by $1.3 billion and up 3% year-over-year. Moving on, earnings per share for the quarter was $1.13, also exceeding guidance by $0.35. For the year, the company generated $30 billion of cash from operations and $11.3 billion of free cash flow.
CEO Pat Gelsinger said “Our disciplined focus on execution across technology development, manufacturing, and our traditional and emerging businesses is reflected in our results. We remain committed to driving long-term, sustainable growth as we relentlessly execute our IDM 2.0 strategy.” With this solid quarter from Intel, would you be watching INTC stock?
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Taiwan Semiconductor Manufacturing Company
Following that, we have one of the largest semiconductor companies in the world, Taiwan Semiconductor Manufacturing Company (TSM). In brief, the company manufactures and sells integrated circuits and semiconductors.
Alongside that, it also offers customer service, account management, and engineering services. Additionally, 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 (NASDAQ: NVDA).
Last month, the company announced its fourth-quarter earnings. Getting into it, the company reported a revenue of around $15.7 billion, a healthy increase of 21.2% year-over-year. As for its net income, it was reported to be $5.97 billion, an increase of 16.4% from a year ago. Earnings aside, the company also plans to spend as much as $44 billion to increase its manufacturing capacity. This indicates a budget increase of almost 50%. TSM expects a multi-year industry megatrend for strong chip demand, boosted by AI, 5G, and the need for high-speed silicon in electronics. Given all this, will you be buying TSM stock?
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