Highlights from Zacks Analyst Blog: NVIDIA, Microchip Tech, ON Semiconductor and STMicroelectronics


For immediate release

Chicago, IL – December 10, 2021 – Zacks.com announces the list of stocks featured on the Analysts Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Recent actions featured in the blog include: NVIDIA Corporation NVDA, Microchip Technology Incorporated MCHP, ON Semiconductor Corporation ON, and STMicroelectronics NV STM.

Here are highlights from Thursday’s analyst blog:

Rise in demand for electronic chip sales: 4 solid stocks in BuYes

Rising demand and an acute tightening in semiconductor supply hurt several industries, but chipmakers were the main winners. Since the start of the pandemic, sales of electronics products have increased, pushing demand for semiconductors.

However, this has turned into a crisis situation for many industries in recent months, with automakers being the hardest hit. Although chipmakers have ramped up production and millions of dollars are being injected to increase production, the supply crunch is expected to last for months.

Semiconductor sales have skyrocketed almost every month for the past two years. Thus, the major manufacturers of electronic chips like NVIDIA, Microchip technology, ON Semiconductor and STMicroelectronics are likely to benefit in the short term.

Semiconductor sales increase in October

The Semiconductor Industry Association (“SIA”) said on December 6 that global semiconductor sales were $ 48.8 billion in October, up from $ 39.4 billion in October 2020. This reflects a jump. 24% year over year. Sales were up 1.1% month-over-month in October from a September total of $ 48.3 billion. October’s gains were due to higher demand for electronic devices.

Sales increased in all regions in October. Year over year, chip sales increased 29.2% in the Americas, 27.3% in Europe and 23.7% in Japan. In Asia-Pacific, sales increased 22.6%, while in China, sales increased 21.1%. On a month-over-month basis, sales were up 2.6% in the Americas, 2.8% in Europe and 1.1% in Japan.

Semiconductor industry set to grow

The semiconductor industry peaked this year after sales started to soar during the height of the pandemic. According to an earlier SIA report, microchip sales totaled $ 144.8 billion in the third quarter of 2021, up 27.6% year-on-year and 7.4% from the second quarter.

In the third quarter, the semiconductor industry also took a significant step forward, shipping the largest number of microchip units in market history.

The tight supply is expected to continue for months given the growing demand from various industries, including the automotive industry. According to Deloitte’s Technology, Media & Telecommunications (TMT) 2022 Predictions report, the global semiconductor shortage could last until early 2023.

The crisis will persist despite increased investment to boost production and things will not start to improve until the end of 2022, according to the report. In addition, venture capitalists will invest more than $ 6 billion in microchip companies in 2022 to increase production.

A separate report from the World Semiconductor Trade Statistics says semiconductor sales will exceed expectations in 2021. According to the latest WSTS industry report, global chip sales will now grow 25.6% in 2021 and 8%. , 8% in 2022.

Our choices

Given the growing demand for semiconductors and the continuing shortage of supply, the semiconductor industry is only expected to benefit in the short term. Below are five bulleted stocks that investors can benefit from in the current scenario.

ON Semiconductor Corp. is an original equipment manufacturer of a broad line of discrete and integrated semiconductor components. ON continues to gain traction among electric vehicle manufacturers for silicon carbide products and insulated gate bipolar transistors. ON Semiconductor has a well-diversified business, generating a significant percentage of revenues from each of the computing, consumer, industrial, communications and automotive end markets.

ON Semiconductor’s expected profit growth rate for the current year is over 100%. Zacks’ consensus estimate for current year earnings has improved 12.4% in the past 60 days. ON shares gained 9.4% over the past month. ON Semiconductor holds a Zacks Rank # 1 (strong buy). You can see The full list of today’s Zacks # 1 Rank stocks here.

Microchip Technology Inc. develops and manufactures microcontrollers, memory, and analog and interface products for integrated control systems, which are small, low-power computers designed to perform specific tasks. MCHP reported earnings of $ 1.07 per share in the second quarter of fiscal 2022, beating Zacks’ consensus estimate of $ 1.06 per share. Microchip Technology reported revenue of $ 1.65 billion for the quarter ended September 2021, beating Zacks’ consensus estimate by 0.10%.

Microchip Technology’s expected profit growth rate for the current year is over 33.9%. Zacks’ consensus estimate for current year earnings has improved 4.5% in the past 60 days. MCHP shares have gained 3.8% in the past 30 days. Microchip technology has a Zacks # 2 rank.

NVIDIA Corporation is the world leader in visual computing technologies and the inventor of the graphics processing unit, GPU. Over the years, NVDA’s focus has evolved from PC graphics to AI-powered solutions that now support high-performance computing, gaming, and virtual reality platforms. The success of NVIDIA’s GPU can be attributed to its parallel processing capabilities supported by thousands of compute cores, which are required to run deep learning algorithms.

NVIDIA’s expected profit growth rate for the current year is 73.2%. Zacks’ consensus estimate for current year earnings has improved 4.6% in the past 60 days. NVDA stock has gained 3.3% in the past 30 days. NVIDIA carries a Zacks Rank # 2.

STMicroelectronics SA designs, develops, manufactures and markets a wide range of semiconductor integrated circuits and discrete devices used in a wide variety of microelectronic applications, including telecommunications systems, computer systems, consumer products, automotive products and industrial automation and control systems. The STM is currently experiencing very strong demand in most product lines and end markets. This leads to high prices and allows STMicroelectronics to operate at full capacity.

STMicroelectronics’ expected profit growth rate for the current year is 65.3%. Zacks’ consensus estimate for current year earnings has improved 4.7% in the past 60 days. STM shares have risen 11% over the past three months. STMicroelectronics holds a Zacks Rank # 2.

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5 actions in the process of doubling

Each has been handpicked by a Zacks expert as the # 1 favorite stock to earn + 100% or more in 2021. Previous recommendations have climbed + 143.0%, + 175.9%, +498 , 3% and + 673.0%.

Most of the stock in this report is flying under Wall Street’s radar, which provides a great opportunity to get into the ground floor.

Today, discover these 5 potential circuits >>

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STMicroelectronics NV (STM): Free Stock Analysis Report

NVIDIA Corporation (NVDA): Free Inventory Analysis Report

Microchip Technology Incorporated (MCHP): Free Inventory Analysis Report

ON Semiconductor Corporation (ON): Free Stock Analysis Report

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