4 semiconductor stocks to watch right now
May 4, 2021
6 min read
This story originally appeared on StockMarket
Are these the best semiconductor stocks to buy right now?
Semiconductor stocks have done extremely well on the stock market in 2020. And analysts expect more big things in the industry in 2021. Simply put, the tech sector continues to thrive as it needs to. much of its huge success to the semiconductor industry. This was likely due to an increase in demand for anything digital as more people have been forced to stay at home due to the pandemic.
Some of the major semiconductor stocks like Advanced Micro Devices (NASDAQ: AMD) fell despite Wall Street estimates leading with their first quarter results last week. But there is no need to write them off at this time. In fact, withdrawal offers excellent entry points for investors. And much of that decline could have something to do with chip shortages. However, if you have a long-term horizon, it’s safe to assume that the technology will only continue to develop.
With the increasing digitization of the objects we use every day, we simply cannot ignore the fact that our lives increasingly depend on semiconductors. Whether it’s your favorite EVs or the new Apple (NASDAQ: AAPL) products you are planning, they all need semiconductors. In addition, the growing popularity of cryptocurrencies has also resulted in a shortage of graphics cards as miners buy them in bulk. That said, the surge in demand for these products bodes well for the companies that make them. With all of that in mind, do you have this list of the top semiconductor stocks to buy on the stock market today?
Best semiconductors to watch this week
Intel is a semiconductor titan that doesn’t need to be introduced. The company recently released its first-quarter earnings, where revenue fell 1% year-over-year to $ 19.7 billion. Intel’s growth in the first quarter erased Wall Street’s low bar, but its mixed forecasts indicated that its problems would persist throughout this year. Following this report, the INTC stock is steadily declining. But could his recent capital spending plans make a difference for the stock?
The company plans to spend more money on semiconductor construction and less on share buybacks. In March, the CEO announced plans for a $ 20 billion expansion of Intel’s Arizona chip manufacturing plant. Today, Intel aims to start manufacturing most of its products in-house. But it will further increase its use of third-party manufacturers.
Intel also announced on Sunday that it would spend $ 3.5 billion to upgrade its New Mexico plant. This is part of a plan to increase the company’s domestic manufacturing investment. As Intel looks to build more of its chips in the US, would you consider INTC stock to be undervalued if you have a long time horizon?
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Semiconductor manufacturing in Taiwan
Taiwan Semiconductor Manufacturing Company (TSM) is another leading semiconductor title to watch right now. Notably, TSM is the world’s largest semiconductor manufacturer. As a result, you could argue that it would benefit significantly from the increased global demand for semiconductors. But its recent price action is certainly preventing investors from taking a direct plunge.
While the fundamentals suggest a loud buy, the stock has moved sideways in recent weeks. TSM’s sales increased 16.7% year over year to $ 12.7 billion, according to its first quarter report. It was the company’s third consecutive quarter of record sales as the global economy rebounded from the coronavirus pandemic. If there is any indication, TSM is growing rapidly, especially for a company of its size.
Despite its sizable gains over the past year, TSM does not seem to be resting on its laurels. For the uninitiated, 75% of TSM’s first quarter revenue comes from smartphones and high performance computing. Even more impressively, the company is also experiencing rapid growth in other industries such as the Internet of Things (IoT) and automotive. Granted, TSM stock may not be cheap at a 31x P / E ratio. But with its leadership position in the market and its growth trajectory, would you want to pick up TSM stock as it slips?
Nvidia is focused on the development of personal computer graphics, graphics processing units (GPUs), as well as artificial intelligence. The company is the inventor of the GPU, which triggered the growth of the PC gaming market. Essentially, Nvidia has redefined modern computer graphics, high performance computing, and artificial intelligence. His pioneering work is to reshape trillion dollar industries such as transportation, healthcare, and manufacturing.
Recently, the company announced that its newly extended AI inference platform with Nvidia A30 and A10 GPUs for consumer servers achieved record performance in all categories on the latest version of MLPerf. MLPerf is the established industry benchmark for measuring AI performance across a range of workloads spanning computer vision, medical imaging, recommender systems, speech recognition, and natural language processing.
Since the AI industry still has a lot of room for growth, Nvidia certainly has a competitive edge with its products. Obviously, companies like Cisco (NASDAQ: CSCO) and Dell Technologies (NYSE: DELL) plan to integrate GPUs into their higher volume servers starting this summer. That being said, will you consider adding NVDA actions to your watchlist?
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With a pressing problem like the global chip shortage, it doesn’t take a genius to know that semiconductor companies are trying to ramp up production to meet demand. Therefore, semiconductor companies can look for ways to mass produce with lower costs and improved performance. And that’s when advanced materials and process solutions company Entegris comes into the picture.
The company generates most of its revenue from semiconductor manufacturers. Having said that, I guess it’s safe to say that Entegris is pure play on the rise of semiconductor chips in the world. The more semiconductor manufacturers plan to increase their offering, the more Entegris will benefit. Since its last earnings call, the company’s management has raised its expectations for its end markets for growth from 13% to 14% in 2021, from a previous estimate of 7% to 8%.
If the strong management advice isn’t convincing enough, Wall Street analysts also expect the company’s sales to hit $ 2.4 billion next year. These analysts seem very confident that ENTG stock will get a boost as many semiconductor manufacturers scramble to increase production capacity. You can also think of the ENTG stock as a pick-and-shovel game in space. Considering all of this, will you be watching the ENTG action?