These semiconductor stocks present a promising future, driving technological advancements in artificial intelligence, augmented reality, quantum computing and beyond. With data storage demands escalating, semiconductor technology plays a pivotal role in enabling upgrades to data center infrastructure. Yet, challenges such as fierce competition and cyclical market trends persist, necessitating strategic investment approaches. Despite risks like trade wars and supply chain disruptions, informed investors can leverage educational resources and research to capitalize on the semiconductor industry’s growth potential. Choosing semiconductor stocks could lead to massive profits.
The semiconductor market size is projected to grow to $1,380.79 billion by 2029, with a 12.2% CAGR . The following semiconductor stocks are projected to grow massively along with the industry growth. Investing in them now will result in your portfolio value skyrocketing from thousands to millions.
Qualcomm (QCOM)
Qualcomm (NASDAQ:QCOM) is one of the largest American quantum computing companies. It focuses on research and development of wireless technology, especially in the communication sector. Valued at $165.28, QCOM has risen over 35% in the past year alone.
The quantum computing industry is one of the largest and fastest-growing markets in the economy, and Qualcomm is poised to take advantage of the large growth. The industry was valued at $717.3 million in 2022, the quantum industry is projected to skyrocket through 2030 with a forecasted valuation of $6.5 billion at that point, marking an impressive 7-year CAGR of 32.1%.
Financially, QCOM is looking green on all accounts in its latest Q4 2023 report. QCOM’s holistic revenue was listed at $9.93 billion, or a YOY increase of nearly 5%. On other metrics, Qualcomm saw 24% YOY jumps from both net income and diluted EPS, with both reported at $2.77 billion and $2.46 respectively.
Qualcomm has set itself apart from the the increasingly competitive the quantum computing market with its 8S Gen 3 Snapdragon chips. These quantum chips, including the modern standard of artificial intelligence capabilities, are dividing the market through its target of mid-tier phones compared to the standard Snapdragon flagship models. Through this innovation of a middle model, QCOM can access both the high-end flagship phone market along the middle tier of products, expanding their market share and likewise profits.
Broadcom (AVGO)
Broadcom (NASDAQ:AVGO) is a designer, developer, manufacturer and global supplier of a wide range of semiconductor and infrastructure software products. It’s best known for producing the Wi-Fi hotspot chip in Apple’s (NYSE:AAPL) iPhone. AVGO’s current value of $1,236.58 grew over 92% this past year.
During Q4 2023, AVGO didn’t manage to show its growth in net income. Broacom’s net income of $1.32 billion grew by 64.89%. Its diluted EPS of $2.84 grew down 67.73% whereas it beat the analyst’s expectations by 5.44%. Its revenue, on the other hand, showed some growth during Q4 2023, with the revenue of $11.96 billion growing 34.17% YOY, beating the analyst’s expectation by 2.06%.
AVGO is rated as a “Strong Buy” (1.3 out of 5). Broadcom’s recent advancements in optical interconnect solutions for AI and ML include 200G/lane EML and VCSEL lasers, driving innovation in AI infrastructure. Industry partnerships and strong AI demand fuel its robust growth projections, with fiscal 2024 revenues expected to reach $50 billion.
Taiwan Semiconductor Manufacturing (TSM)
Taiwan Semiconductor Manufacturing (NYSE:TSM) is a semiconductor manufacturer, offering international access to chip fabrication and engineering services. It is best known for manufacturing chips for industry giants such as Apple, Nvidia (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD) and Qualcomm.
While earnings estimates are volatile, ranging from $1.08 to $1.37 billion, TSM regularly beats estimates. It currently has rating between “Strong Buy” and “Buy” on Yahoo! Finance. After a record-breaking 2022, TSM revenue slid in 2023, going down to $2.16 trillion. However, given the volatility in the semiconductor market due to shortages, this decrease is not to the company’s performance.
The semiconductor sector has a projected CAGR of 12.2%. However, market volatility, supply/demand shocks and geopolitical tensions are factors that may cause this growth to stagnate. To combat this, TSM is diversifying its factories out of the East-Asia region and into relatively more stable countries like the U.S. Additionally, it is in talks with Foxconn, another semiconductor manufacturer, to build a factory in India.
As demand for semiconductors picks up, TSM’s value will too. Management’s decision to invest in future-proofing revenue streams shows foresight and proactivity, which are great precursors to growth. All this makes TSM a “Buy” stock.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
