The stocks of companies involved in the design and fabrication of integrated circuits or microchips are termed as microchip stocks. With technology so prevalent in our lives, microchips are increasingly used to program logic and for computer memory to be used in devices like electronics, autonomous cars, and medical equipment. As a result, the microchip industry has experienced beneficial tailwinds and has been rallying for the past years.
Due to the increased trends towards artificial intelligence, robotics, gaming, connected devices, data centers, and cloud computing, the demand and prices of microchips have been soaring. Therefore, the performance of microchip stocks has also improved, making them excellent additions to the investment portfolio.
|TXN||Texas Instruments Incorporated||$172.81||32.40%||158.6B|
|AMD||Advanced Micro Devices, Inc.||$92.79||84.29%||111.6B|
|NXPI||NXP Semiconductors N.V.||$172.30||27.37%||48.2B|
|MXIM||Maxim Integrated Products, Inc.||$93.62||49.65%||25.0B|
|ON||ON Semiconductor Corporation||$37.30||49.26%||15.3B|
|VSH||Vishay Intertechnology, Inc.||$23.16||6.14%||3.1B|
|MTSI||MACOM Technology Solutions Holdings, Inc.||$61.99||114.50%||4.2B|
|GSIT||GSI Technology, Inc.||$7.89||-7.29%||186.5M|
|ADI||Analog Devices, Inc.||$155.58||32.33%||57.5B|
|SWKS||Skyworks Solutions, Inc.||$161.27||31.85%||26.8B|
|MRVL||Marvell Technology Group Ltd.||$52.62||92.68%||35.3B|
|SLAB||Silicon Laboratories Inc.||$142.36||19.11%||6.2B|
|AMKR||Amkor Technology, Inc.||$18.47||44.41%||4.5B|
|POWI||Power Integrations, Inc.||$94.37||83.53%||5.6B|
|TSEM||Tower Semiconductor Ltd.||$30.23||21.65%||3.2B|
|DSPG||DSP Group, Inc.||$16.65||5.25%||392.9M|
|AAOI||Applied Optoelectronics, Inc.||$10.47||-25.00%||240.6M|
|SQNS||Sequans Communications S.A.||$8.10||68.40%||248.6M|
|AMAT||Applied Materials, Inc.||$106.33||71.50%||97.2B|
Factors to Consider Before Investing in Microchip Stocks
Investors must consider the financial health of microchip manufacturers before investing in microchip stocks. The fundamental analysis should include earnings and revenue growth, P/E ratio, and other forward multiples.
In addition to the fundamental parameters, investors should also take the supply and demand dynamics into account. Currently, microchips have a high demand and lower supply, leading to high microchip stock prices. However, the slowdown in demand due to the trade tensions between the US and China has dampened the growth to some extent. Investors should look for microchip stocks that are fundamentally strong to overcome the temporary headwinds caused by market conditions.
Which Microchip Stocks Should I Buy?
A wide variety of microchip stocks trades on the US stock exchanges. They include companies that manufacture microchips as well as the companies that supply the raw material for the microchip manufacturing process. We have compiled a list of the best microchip stocks for investors to choose from.
Investors can choose to invest in microchip stocks of companies that have been in the market for years and are well-established. They promise stable and high returns in the long-term. However, new entrants in the microchip space, although risky, can also prove to be efficient investments if the selection is made wisely.
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