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4 Solid Semiconductor Stocks to Buy in a Promising 2024
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The semiconductor market is staging a solid rebound after a not-so-impressive first half of 2023. Semiconductor sales rose a solid 5.3% year over year in November 2023, the first time since August 2022, as demand rebounded on easing inflation, the Semiconductor Industry Association said on Jan 9.
Sales totaled $48 billion in November compared to $45.6 billion a year ago. Also, sales jumped a solid 2.9% month over month in November from October’s total of $46.6 billion.
The year-over-year jump in sales in November was driven primarily by robust demand from China, where sales were up 7.6%. Besides, sales rose 7.1% in Asia Pacific and 5.6% in Europe, while it witnessed a 3.5% rise in the Americas.
The semiconductor market, which reached unprecedented heights during the peak of the pandemic, suffered from a supply-chain crisis in 2021, which saw sales slowing at a fast pace. Although demand was high in 2022 and the supply-chain crisis eased, rising prices and inflationary pressures started taking a toll on sales.
The Federal Reserve’s monetary tightening campaign that saw rates being hiked by 525 basis points further slowed sales.
However, semiconductor demand was always high from multiple industries, which saw the industry making a steady rebound from the second quarter of 2023 and sales have since been on the rise.
Demand for semiconductors is expected to rise through 2024, which bodes well for the industry. The semiconductor market is expected to experience positive outcomes due to the global integration and extensive utilization of consumer electronics.
Moreover, the growing influence and broad implementation of advanced technologies such as artificial intelligence, the Internet of Things, and machine learning are foreseen to be significant factors in sustaining the ongoing demand for semiconductors.
According to the World Semiconductor Trade Statistics (WSTS), global semiconductor sales are projected to jump 13.1% in 2024. WSTS estimates global sales to reach $588.4 billion.
Our Choices
Given the promising future, it would be wise to invest in semiconductor stocks. Below are four chip stocks that investors can gain from in the near term.
NVIDIA Corporation (NVDA - Free Report) is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit (GPU). Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms. NVIDIA’s GPU success can be attributed to its parallel processing capabilities supported by thousands of computing cores necessary to run deep-learning algorithms.
NVIDIA’s expected earnings growth rate for the current year is 268.6%. The Zacks Consensus Estimate for current-year earnings has improved 13.7% over the past 60 days. NVDA presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Photronics, Inc. (PLAB - Free Report) is a leading worldwide manufacturer of photomasks. Photomasks are high-precision quartz plates that contain microscopic images of electronic circuits. PLAB produces photomasks in accordance with product designs provided by customers at strategically located manufacturing facilities in Asia, Europe, and North America.
Photronics’ expected earnings growth rate for the current year is 27.5%. The Zacks Consensus Estimate for current-year earnings has improved 15.6% over the past 60 days. PLAB currently sports a Zacks Rank #1.
ASML Holding N.V. (ASML - Free Report) is a world leader in the manufacture of advanced technology systems for the semiconductor industry. ASML offers an integrated portfolio for manufacturing complex integrated circuits. ASML Holdingdesigns, develops, integrates, markets and services advanced systems used by customers the major global semiconductor manufacturers to create chips that power a wide array of electronic, communications and information technology products.
ASML Holding’s expected earnings growth rate for the current year is 39%. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the past 60 days. ASML currently carries a Zacks Rank #2.
Micron Technology, Inc. (MU - Free Report) has established itself as one of the leading worldwide providers of semiconductor memory solutions. Through global brands, namely Micron, Crucial and Ballistix, MU manufactures and markets high-performance memory and storage technologies including Dynamic Random Access Memory, NAND flash memory, NOR Flash, 3D XPoint memory and other technologies. Micron Technology’s solutions are used in leading-edge computing, consumer, networking and mobile products.
Micron Technology’s expected earnings growth rate for the current year is 90.1%. The Zacks Consensus Estimate for current-year earnings has improved 74.6% over the past 60 days. MU holds a Zacks Rank #2.
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4 Solid Semiconductor Stocks to Buy in a Promising 2024
The semiconductor market is staging a solid rebound after a not-so-impressive first half of 2023. Semiconductor sales rose a solid 5.3% year over year in November 2023, the first time since August 2022, as demand rebounded on easing inflation, the Semiconductor Industry Association said on Jan 9.
Sales totaled $48 billion in November compared to $45.6 billion a year ago. Also, sales jumped a solid 2.9% month over month in November from October’s total of $46.6 billion.
The year-over-year jump in sales in November was driven primarily by robust demand from China, where sales were up 7.6%. Besides, sales rose 7.1% in Asia Pacific and 5.6% in Europe, while it witnessed a 3.5% rise in the Americas.
The semiconductor market, which reached unprecedented heights during the peak of the pandemic, suffered from a supply-chain crisis in 2021, which saw sales slowing at a fast pace. Although demand was high in 2022 and the supply-chain crisis eased, rising prices and inflationary pressures started taking a toll on sales.
The Federal Reserve’s monetary tightening campaign that saw rates being hiked by 525 basis points further slowed sales.
However, semiconductor demand was always high from multiple industries, which saw the industry making a steady rebound from the second quarter of 2023 and sales have since been on the rise.
Demand for semiconductors is expected to rise through 2024, which bodes well for the industry. The semiconductor market is expected to experience positive outcomes due to the global integration and extensive utilization of consumer electronics.
Moreover, the growing influence and broad implementation of advanced technologies such as artificial intelligence, the Internet of Things, and machine learning are foreseen to be significant factors in sustaining the ongoing demand for semiconductors.
According to the World Semiconductor Trade Statistics (WSTS), global semiconductor sales are projected to jump 13.1% in 2024. WSTS estimates global sales to reach $588.4 billion.
Our Choices
Given the promising future, it would be wise to invest in semiconductor stocks. Below are four chip stocks that investors can gain from in the near term.
NVIDIA Corporation (NVDA - Free Report) is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit (GPU). Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms. NVIDIA’s GPU success can be attributed to its parallel processing capabilities supported by thousands of computing cores necessary to run deep-learning algorithms.
NVIDIA’s expected earnings growth rate for the current year is 268.6%. The Zacks Consensus Estimate for current-year earnings has improved 13.7% over the past 60 days. NVDA presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Photronics, Inc. (PLAB - Free Report) is a leading worldwide manufacturer of photomasks. Photomasks are high-precision quartz plates that contain microscopic images of electronic circuits. PLAB produces photomasks in accordance with product designs provided by customers at strategically located manufacturing facilities in Asia, Europe, and North America.
Photronics’ expected earnings growth rate for the current year is 27.5%. The Zacks Consensus Estimate for current-year earnings has improved 15.6% over the past 60 days. PLAB currently sports a Zacks Rank #1.
ASML Holding N.V. (ASML - Free Report) is a world leader in the manufacture of advanced technology systems for the semiconductor industry. ASML offers an integrated portfolio for manufacturing complex integrated circuits. ASML Holdingdesigns, develops, integrates, markets and services advanced systems used by customers the major global semiconductor manufacturers to create chips that power a wide array of electronic, communications and information technology products.
ASML Holding’s expected earnings growth rate for the current year is 39%. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the past 60 days. ASML currently carries a Zacks Rank #2.
Micron Technology, Inc. (MU - Free Report) has established itself as one of the leading worldwide providers of semiconductor memory solutions. Through global brands, namely Micron, Crucial and Ballistix, MU manufactures and markets high-performance memory and storage technologies including Dynamic Random Access Memory, NAND flash memory, NOR Flash, 3D XPoint memory and other technologies. Micron Technology’s solutions are used in leading-edge computing, consumer, networking and mobile products.
Micron Technology’s expected earnings growth rate for the current year is 90.1%. The Zacks Consensus Estimate for current-year earnings has improved 74.6% over the past 60 days. MU holds a Zacks Rank #2.