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The semiconductor market has historically been highly cyclical as it is closely connected to various other markets. This normal fluctuation along with the current U.S.-China trade war has created a market that has done significantly worse than the S&P YTD. That being said, here are some semiconductor stocks that still appear strong even with the current situation.
All 5 stocks in this article have a Zacks Rank #2 (Buy) or better. Additionally, all stocks are mid-cap (Market Capitalization between $1 and $10 billion).
Lattice is ranked third in the world for its market share of "field programmable gate array devices." YTD, Lattice is up 78%. That significant jump can make investors hesitant to buy as it seems there is no way the stock could continue to go higher, but with Lattice that does not seem to be the case. Lattice has an "A" grade for Growth in our Style Scores system and our Zacks Consensus Estimates call for 48% and 31% year over year EPS growth for fiscal 2019 and 2020, respectively with EPS expected to be $0.64 by the end of fiscal 2020 compared to its EPS of $0.33 in 2018. This, along with the recent product releases related to AI and a market that continues to grow, could help to fuel Lattice’s future growth and success.
Cirrus Logic is a semiconductor company that mainly deals in audio related technology. Cirrus on paper seems very similar to Lattice in that both seem to have good growth prospects. Cirrus is up 14% YTD which is clearly not as good as Lattice. But our Zacks Consensus Estimates call for its earnings to drop 14.4% during the current fiscal year and then quickly rebound 11.8% in fiscal 2021 (CRUS starts its fiscal year in March). And CRUS’ current year earnings estimate revisions have trended heavily in the right direction recently. This means at least some analysts are more positive about Cirrus Logic’s bottom-line than they were before the quarter began.
Cypress Semiconductor Corp
Zacks Rank: #2 (Buy)
Cypress has a variety of automotive related semiconductor products and is based in San Jose, CA. Cypress is up over 15% since market open on Wednesday. This sudden jump came from speculation of a possible buyout or merger. Cypress claimed to have received a buyout offer and seem to be using this information to help leverage a better deal from the initial company or another company. A buyout could provide quick profit for investors as Cypress hopefully would not accept a buyout offer less than its market value. If a buyout were not to occur, there is still reason to invest. Zacks Consensus Estimates put year over year EPS growth for Cypress at over 11%, fueled by projected revenue growth of 5% for fiscal 2020.
Based in Silicon Valley, Power Integrations develops and produces semiconductors for multiple industries. The company has had multiple positive earnings estimate revisions as of late which helps it earn a Zacks Rank #2 (Buy). Along with these revisions, the industry it’s in, Semiconductors-Power, is currently ranked No. 1 out of over 250 Zacks industries, which is a positive sign for all the companies in the industry and helps Power Integrations stand out as a possible good addition to a portfolio. Our Zacks Consensus Estimate has Power Integrations’ EPS surging 27% along with a 14.7% revenue increase for fiscal 2020. This would, however, come after a projected 12.5% earnings decline this year and 0.72% revenue growth.
Headquartered in Shanghai, Semiconductor Manufacturing International provides manufacturing services for certain integrated circuit process technologies. Zacks Consensus Estimates has SMI’s revenue decreasing around 10% for fiscal 2019, but is then supposed to jump back up 6.5% in fiscal 2020. This, coupled with the recent upward earnings estimate revisions for fiscal 2019 and 2020 make it look like SMI may be able to build upon the stock’s 38% YTD growth.
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Image: Bigstock
5 Mid-Cap Semiconductor Stocks to Buy Right Now
The semiconductor market has historically been highly cyclical as it is closely connected to various other markets. This normal fluctuation along with the current U.S.-China trade war has created a market that has done significantly worse than the S&P YTD. That being said, here are some semiconductor stocks that still appear strong even with the current situation.
All 5 stocks in this article have a Zacks Rank #2 (Buy) or better. Additionally, all stocks are mid-cap (Market Capitalization between $1 and $10 billion).
Lattice Semiconductor (LSCC - Free Report)
Zacks Rank: #2 (Buy)
Lattice is ranked third in the world for its market share of "field programmable gate array devices." YTD, Lattice is up 78%. That significant jump can make investors hesitant to buy as it seems there is no way the stock could continue to go higher, but with Lattice that does not seem to be the case. Lattice has an "A" grade for Growth in our Style Scores system and our Zacks Consensus Estimates call for 48% and 31% year over year EPS growth for fiscal 2019 and 2020, respectively with EPS expected to be $0.64 by the end of fiscal 2020 compared to its EPS of $0.33 in 2018. This, along with the recent product releases related to AI and a market that continues to grow, could help to fuel Lattice’s future growth and success.
Cirrus Logic Inc. (CRUS - Free Report)
Zacks Rank: #1 (Strong Buy)
Cirrus Logic is a semiconductor company that mainly deals in audio related technology. Cirrus on paper seems very similar to Lattice in that both seem to have good growth prospects. Cirrus is up 14% YTD which is clearly not as good as Lattice. But our Zacks Consensus Estimates call for its earnings to drop 14.4% during the current fiscal year and then quickly rebound 11.8% in fiscal 2021 (CRUS starts its fiscal year in March). And CRUS’ current year earnings estimate revisions have trended heavily in the right direction recently. This means at least some analysts are more positive about Cirrus Logic’s bottom-line than they were before the quarter began.
Cypress Semiconductor Corp
Zacks Rank: #2 (Buy)
Cypress has a variety of automotive related semiconductor products and is based in San Jose, CA. Cypress is up over 15% since market open on Wednesday. This sudden jump came from speculation of a possible buyout or merger. Cypress claimed to have received a buyout offer and seem to be using this information to help leverage a better deal from the initial company or another company. A buyout could provide quick profit for investors as Cypress hopefully would not accept a buyout offer less than its market value. If a buyout were not to occur, there is still reason to invest. Zacks Consensus Estimates put year over year EPS growth for Cypress at over 11%, fueled by projected revenue growth of 5% for fiscal 2020.
Power Integrations Inc (POWI - Free Report)
Zacks Rank: #2 (Buy)
Based in Silicon Valley, Power Integrations develops and produces semiconductors for multiple industries. The company has had multiple positive earnings estimate revisions as of late which helps it earn a Zacks Rank #2 (Buy). Along with these revisions, the industry it’s in, Semiconductors-Power, is currently ranked No. 1 out of over 250 Zacks industries, which is a positive sign for all the companies in the industry and helps Power Integrations stand out as a possible good addition to a portfolio. Our Zacks Consensus Estimate has Power Integrations’ EPS surging 27% along with a 14.7% revenue increase for fiscal 2020. This would, however, come after a projected 12.5% earnings decline this year and 0.72% revenue growth.
Semiconductor Manufacturing Intl Corporation (SMI - Free Report)
Zacks Rank: #2 (Buy)
Headquartered in Shanghai, Semiconductor Manufacturing International provides manufacturing services for certain integrated circuit process technologies. Zacks Consensus Estimates has SMI’s revenue decreasing around 10% for fiscal 2019, but is then supposed to jump back up 6.5% in fiscal 2020. This, coupled with the recent upward earnings estimate revisions for fiscal 2019 and 2020 make it look like SMI may be able to build upon the stock’s 38% YTD growth.
The Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
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