Could Investors Be Shifting Their Focus To These Top Semiconductor Stocks Right Now?
Semiconductor stocks have been the essential drivers for technology growth in the past decade, and arguably more so after the pandemic. Some of the top semiconductor stocks have easily beaten the stock market on the back of impressive growth in revenue and earnings. It’s no secret that semiconductor companies have rewarded investors handsomely just in the past year alone.
Following the news of Analog Devices (NASDAQ: ADI) and Maxim Integrated Products (NASDAQ: MXIM) acquiring antitrust clearance from China’s State Administration for Market Regulation (SAMR), semiconductor stocks have received another timely boost in the stock market this week. The deal, which had already been approved by boards of both the companies, will create a chip-making giant worth $68 billion, according to Analog Devices.
With the chip shortage expected to continue, many semiconductor stocks are ripe for continued gains. Today, we also saw Samsung Group announce that it will invest $205 billion in the next three years to expand its footprint in the post-pandemic era. The company expects these investments to strengthen its global position in the sector. Thus, would investing in semiconductor stocks be one of the better choices in the stock market today? If you share the same sentiment, do you have this list of the top semiconductor stocks to invest in today?
Top Semiconductor Stocks To Buy [Or Sell] This Week
- Advanced Micro Devices, Inc (NASDAQ: AMD)
- NVIDIA Corporation (NASDAQ: NVDA)
- Applied Materials, Inc (NASDAQ: AMAT)
- Marvell Technology Inc (NASDAQ: MRVL)
Advanced Micro Devices
First, on the list, we will be looking at the global semiconductor giant, Advanced Micro Devices (AMD). Some of the company’s notable products include the x86 microprocessors (CPUs), accelerated processing units, graphic processing units (GPU), and semi-custom System-on-Chip products and chipsets. Notably, AMD stock jumped by 4% in Monday’s trading session.
As some of you may recall, AMD announced the acquisition of Xilinx (NASDAQ: XLNX) back in October 2020. Up to now, the company has received antitrust approvals from the European Commission and from the U.K. government. So, this acquisition is now in the hands of the Chinese regulators and investors are responding positively to the recent development.
Financially, the company has also been firing on all cylinders. For its second quarter, the company posted revenue of $3.85 billion, almost doubling that of the previous year. This is largely driven by higher revenue in both the Computing and Graphics segment and Enterprise and Embedded and Semi-custom segments. Furthermore, its net income was $710 million, increasing by a staggering 452% year-over-year. With all these in mind, would you consider buying AMD stock?
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Another semiconductor company that requires little introduction is Nvidia. The company that’s best known for its GPU for the gaming and professional market has been under scrutiny over its potential acquisition of Arm Holdings recently. With the pending acquisition requiring clearance from China, NVDA stock investors appear to be hopeful. The company stock has risen over 10% just within the past week.
Last week, Nvidia posted its second-quarter earnings. As expected, it was yet another strong financial quarter for the company. It posted revenue of $6.51 billion, representing an increase of 68% year-over-year. Out of which, gaming revenue was $3.06 billion, up by a whopping 85% year-over-year. Also, its GAAP earnings per diluted share for the quarter was $0.94, representing an increase of a staggering 276% from a year ago and 24% from the previous quarter.
Furthermore, there was also the launch of the company’s NVIDIA Omniverse during the quarter. In this simulation and collaboration platform, artists can create any digital scenes they like, and engineers can go wild with their designs. These creations can then be taken into the physical world after it has been perfected in the digital world. Given these exciting developments, would it be too late to jump on the NVDA stock bandwagon?
Applied Materials is one of the leading names in terms of materials engineering solutions. In detail, the company specializes in providing the necessary equipment, services, and software for the semiconductor manufacturing industry. Well, it achieves this via its expertise in modifying materials at atomic levels and on industrial scales. Given the company’s vital role in enabling the semiconductor industry, AMAT stock would be in the spotlight now.
On Friday last week, Applied Materials announced its third-quarter financials. It posted record quarterly revenue of $6.20 billion, representing an increase of 41% year-over-year. Moreover, the company also posted record quarterly GAAP earnings per share of $1.87, up by 105% year-over-year. This record performance is fueled by the digital transformation of the economy that has a strong demand for semiconductors. After all, Applied Materials does have one of the broadest and most enabling portfolio of technologies to accelerate its customer’s roadmaps.
It is noteworthy that the California-based company unveiled a new way to engineer the wiring of advanced logic chips that enables scaling to the 3nm node and beyond during its third quarter. The new solution called the Endura® Copper Barrier Seed IMS™ combines seven different process technologies in one system under high vacuum to improve chip performance and power consumption. So, consumers can now have more capable devices and longer battery life. All things considered, would AMAT stock be a viable investment?
Last but not least, we have the data infrastructure semiconductor company, Marvell. In essence, the company engages in delivering data infrastructure technology that connects the world. It moves, stores, processes, and secures data with semiconductor solutions designed for its customer needs. Impressively, MRVL stock has risen over 75% over the past year.
Earlier this month, Marvell announced a definitive agreement, under which the company will acquire Innovium in an all-stock transaction. The addition of Innovium will provide Marvell with incremental engineering resources to focus on cloud-optimized silicon. This can be achieved through the TERALYNX™ platform as the 9K product family. As Innovium has established itself as a strong cloud data center merchant switch silicon provider with a proven platform, it would further accelerate Marvell’s cloud growth.
Furthermore, Marvell started its fiscal year 2022 on a strong note. For its first quarter, it posted revenue of $832 million, up by 20% year-over-year. Marvell also acquired Inphi Corporation which increased and accelerated its growth opportunities in the data center, Marvell’s largest end market by revenue. Now that the company will be announcing its second-quarter financial update on August 26, would you buy MRVL stock ahead of its earnings report?