4 Top Semiconductor Stocks To Watch Now For Your Long-Term Portfolio
As we end the first week of trading in June, value investors could be eyeing semiconductor stocks now. Why? Well, this part of the stock market represents one of, if not the most crucial tech industry in the world today. Simply put, semiconductors are a fundamental part of numerous kinds of electronic parts and elements. In turn, these parts serve as core components for most electronic devices in our world today. From the automotive industry to the gaming and home electronics markets, semiconductors are often the brains behind the operations. Furthermore, as most investors would know, there is a global shortage of semiconductor chips. Because of this, some could see a buying opportunity amidst the top semiconductor stocks now.
Namely, analysts from Goldman Sachs (NYSE: GS) and Bank of America (NYSE: BAC) remain “very bullish” on the industry now. After all, semiconductors are essential parts of essential goods in our increasingly digital world today. Even with the current shortage, semiconductor companies such as Monolithic Power Systems (NASDAQ: MPWR) and Broadcom (NASDAQ: AVGO) are prospering.
On one hand, MPWR reported year-over-year surges of 53% in total revenue and 40% in cash on hand in its recent quarter fiscal. On the other hand, Broadcom saw its net income for the quarter skyrocket by over 257% year-over-year, adding up to $1.38 billion. With all this momentum in the semiconductor industry now, here are four top semiconductor stocks to know now in the stock market today.
Best Semiconductor Stocks To Watch In June
- ON Semiconductor Corporation (NASDAQ: ON)
- NVIDIA Corporation (NASDAQ: NVDA)
- Advanced Micro Devices Inc. (NASDAQ: AMD)
- Taiwan Semiconductor Manufacturing Company (NYSE: TSM)
ON Semiconductor Corp
ON is a semiconductor company that creates energy-efficient innovations. The company is a leading supplier of semiconductor-based solutions, offering a comprehensive portfolio of energy-efficient power management, analog, sensors, and custom devices. In essence, its products help customers solve unique design challenges in many fields. Namely, it has clients in the communications, automotive, medical, industrial, and aerospace industries. ON stock currently trades at $38.29 as of 10:32 a.m. ET.
Last month, the company reported impressive first-quarter financials. Firstly, it reported a revenue of $1.48 billion, up by 16% year-over-year. Secondly, it posted a GAAP diluted earnings per share of $0.20 for the quarter. Cash generated by operating activities was $218.5 million, up by 31.6% year-over-year. ON says that its strong results were driven by disciplined execution in a strong demand environment across its focus end-markets. It also says momentum in its strategic automotive and industrial end-markets continue to accelerate. For these reasons, will you consider buying ON stock?
Nvidia is a semiconductor company that has taken the world by storm. In brief, it practically redefined modern computer graphics and revolutionized parallel computing. Furthermore, its products are used in the growing markets of gaming, professional visualization, data center, and automotive. NVDA stock currently trades at $697.94 as of 10:33 a.m. ET. The company reported its first-quarter financials in late May as well.
Specifically, Nvidia posted a record revenue of $5.66 billion, up by a whopping 84% year-over-year. A chunk of this revenue came from its gaming revenue, at $2.76 billion. Also, datacenter revenue was $2.05 billion, up by 79% year-over-year.
CEO of Nvidia, Jensen Huang had this to say, “Our Data Center business continues to expand, as the world’s industries take up NVIDIA AI to process computer vision, conversational AI, natural language understanding, and recommender systems. NVIDIA RTX has reinvented computer graphics and is driving upgrades across the gaming and design markets.” Given the excitement surrounding Nvidia, will you consider buying NVDA stock?
Advanced Micro Devices Inc.
AMD is a multinational semiconductor company that is based in Santa Clara, California. It develops computer processors and technologies for the business and consumer markets. The company boasts hundreds of millions of consumers and leading Fortune 500 businesses to rely on its technology to improve efficiency and productivity. AMD stock currently trades at $81.13 as of 10:31 a.m. ET. On May 31, 2021, the company showcased its latest computing and graphics technology innovations.
In detail, it showed how it innovates to accelerate the high-performance computing ecosystem, spanning gaming, PCs, and the data center. The company unveiled the latest breakthrough in high-performance computing with new 3D chiplet technology. It also expanded the adoption of AMD computing and graphics technologies in the automotive and mobile markets with industry leaders like Tesla (NASDAQ: TSLA) and Samsung (OTCMKTS: SSNLF). All things considered, is AMD stock worth buying?
Taiwan Semiconductor Manufacturing Company
Last but not least, we have the largest semiconductor manufacturer in the world, Taiwan Semiconductor Manufacturing (TSM). As one of the earliest names in the semiconductor foundry business, TSM is no newcomer to the game as well. For the most part, the company primarily manufactures and markets integrated circuits and related semiconductor products. Moreover, TSM also owns and operates the largest semiconductor design ecosystem globally, the Open Innovation Platform. Because of all this, investors looking to bet on the booming semiconductor market now would be looking at TSM stock. The company’s shares currently trade at $118.86 as of 10:34 a.m. ET.
Indeed, while TSM may be a leading name in the industry now, it is not resting on its laurels yet. According to CEO C.C. Wei, the company is commencing construction of its $12 billion computer chip factory in Arizona this week.
Gartner’s (NYSE: IT) VP Alan Priestly, argues that Intel’s (NASDAQ: INTC) current presence in the region could benefit TSM as well. This would be thanks to the local universities having “established a strong reputation for semiconductor design courses and research”, creating a skilled workforce in the local semiconductor industry. Priestley believes that TSM could tap into this resource along with the ecosystem of supply chain vendors available. No doubt, this makes a highly strategic move by the company as it attempts to catch up with current chip demands. Could all this make TSM stock a top buy for you now?