The 2030 Millionaire's Club: 3 Semiconductor Stocks to Buy Now – InvestorPlace
These chip stocks are rising high and delivering big gains to their stockholders
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Semiconductor stocks continue to be a hot corner of the market. As the technology that enables artificial intelligence applications and models, demand for shares of companies that design and fabricate microchips and semiconductors is growing exponentially.
According to Fortune Business Insights, the worldwide market for chips and semiconductors is forecast to reach $2 trillion by 2032, up from $681 billion this year.
Given the explosive growth, it makes sense for investors to hold some semiconductor stocks in their portfolio. And there are more stocks to consider than just Nvidia (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD). While those stocks seem to get all the attention, the chip sector is diverse with plenty of names to consider.
Here is the 2030 millionaire’s club: three semiconductor stocks to buy now.
As is typical, Applied Materials (NASDAQ:AMAT) just delivered strong financial results that beat Wall Street forecasts on the top and bottom lines. The microchip-equipment maker, whose components are used by companies like Nvidia and AMD, announced earnings per share of $2.09 for its second fiscal quarter. That was ahead of analysts’ consensus estimates that called for a profit of $1.99 a share.
Revenue in the quarter totaled $6.65 billion, topping Wall Street forecasts of $6.54 billion. The company also raised its forward guidance. For the current quarter, Applied Materials said it expects $6.65 billion of revenue and $2.19 in EPS.
Analysts had penciled in for the company sales of $6.59 billion and a profit of $1.98 a share. Applied Materials CEO Gary Dickerson said the company is seeing increased demand for its products from chipmakers as the AI buildout accelerates.
AMAT stock has increased abiyt 74% over the last 12 months and is up about 457% in the past five years.
To Europe with ASML Holding (NASDAQ:ASML). The Dutch microchip company specializes in making photolithography machines that are used to produce computer microchips. Like Applied Materials, ASML’s equipment is in hot demand as the industry works overtime to produce chips to power the AI revolution.
As a result, ASML stock is up about 29% this year and up about 388% through five years. The company’s stock is one of the best performers among European equities.
That said, the share price fell briefly in mid-April after the company reported financial results that missed the mark in terms of revenue figures. The downturn didn’t last long and ASML stock quickly recovered. In the last month, the share price has risen 6%.
There are finally signs of life at Texas Instruments (NASDAQ:TXN). After a long-term underperformance, TXN stock is up 22% in the past month after the legacy semiconductor company delivered better-than-expected financial results for this year’s first quarter.
For Q1, Texas Instruments reported EPS of $1.20. That was ahead of Wall Street forecasts of $1.07 per share. Revenue came in at $3.66 billion, which topped analyst estimates of $3.60 billion.
The earnings beat has Texas Instruments’ stock marching higher. The company primarily makes microchips and semiconductors for use in the automotive industry and industrial applications.
In terms of guidance, Texas Instruments forecast Q2 revenue of $3.65 billion to $3.95 billion and profits of $1.05 to $1.25 per share. The outlook aligned with Wall Street forecasts. TXN stock is now up 16% over the past 12 months and has nearly doubled over the last five years.
On the date of publication, Joel Baglole held long positions in NVDA and AMAT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.
Article printed from InvestorPlace Media, https://investorplace.com/2024/05/the-2030-millionaires-club-3-semiconductor-stocks-to-buy-now/.
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