Zacks Analyst Blog Highlights Silicon Laboratories, MACOM Technology Solutions, Taiwan Semiconductor Manufacturing, STMicroelectronics NV

for immediate publication

Chicago, IL – August 4, 2022 – announces the list of stocks featured on the Analyst Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured on the blog include: Silicon Laboratories Inc. SLAB, MACOM Technology Solutions Holdings, Inc. MTSI, Taiwan Semiconductor Manufacturing Company Limited TSM, and STMicroelectronics NV STM.

Here are the highlights from Wednesday’s analyst blog:

4 Strong Stocks to Buy on Rising Semiconductor Sales

The dream race for the semiconductor sector continues with sales reaching a record in the second quarter of the year. Sales have risen in every month this year, indicating that rising demand for semiconductors is helping manufacturers earn higher revenues.

Semiconductor shortages have crippled several industries, but pent-up demand for microchips has helped manufacturers. The demand for microchips has increased in recent years as the Internet of Things (IoT), artificial intelligence and virtual reality have become increasingly important in our lives. Given this situation, actions such as silicon labs inc., Technology Solutions MACOM Holdings, Inc., Taiwan Semiconductor Manufacturing Company Limited Y STMicroelectronics N.V. they are expected to benefit in the short term.

Solid year for semiconductors

After a strong 2020 and 2021, the semiconductor industry continues to flourish this year, with sales increasing in almost every month of 2022. The Semiconductor Industry Association (SIA) announced on August 3 that global sales of semiconductors they increased a solid 13.3% year-on-year to $152.5 billion in the second quarter of 2022.

In addition, sales increased 0.5% quarterly from the first quarter. In June, global sales reached $50.8 billion.

“Global semiconductor sales were strong during the second quarter of 2022, increasing in all major regional markets and product categories compared to the second quarter of last year,” said SIA President and CEO John Neuffer.

Though the report says sales have slowed a bit lately amid multiple challenges like rising costs and a supply chain crisis, the industry is still growing. Even then, year-over-year sales in June were up 29% in the Americas, 16.1% in Japan, 12.4% in Europe, and 11.9% in the Asia Pacific region.

This clearly shows how the demand for microchips has increased over the last year.

industry on land

Although sales have been growing, the semiconductor industry has faced challenges. The supply chain crisis that began during the peak of the pandemic has continued and various industries are suffering due to acute shortages.

In fact, this has also caused sales growth to slow to some extent. However, several governments, including the United States, have addressed the crisis and are trying to help the industry. Last week, the US Senate voted 64-32 to advance a key bipartisan bill aimed at boosting domestic semiconductor manufacturing and helping the country compete with China.

President Joe Biden is likely to sign the bipartisan bill at any time. The $280 billion package will be in the form of grants and research funding.

Dubbed the Chips and Science Act, the legislation includes $52 billion for US semiconductor manufacturing companies in the form of subsidies. This is likely to give a big boost to semiconductor production.

Additionally, it will provide semiconductor factories with a $24 billion investment tax credit. Biden and other experts have stated that the new law is crucial to the nation’s economic health and national security as the world becomes increasingly reliant on technology. In this way, the law will help America become more self-sufficient.

Although the supply crisis is far from over, the new measure is expected to greatly alleviate this problem, which can only benefit the business in the future.

Our options

The semiconductor industry is only likely to benefit in the short term, thanks to the new bill and increased demand. Given this scenario, these four chip stocks are likely to benefit in the short term.

silicon labs inc. is a leading provider of silicon, software, and solutions for the Internet of Things, Internet infrastructure, industrial automation, consumer, and automotive markets. SLAB solves the electronics industry’s toughest problems, giving customers significant advantages in performance, power savings, connectivity, and design simplicity.

Silicon Laboratories’ expected earnings growth rate for the current year is 90%. The Zacks consensus estimate for current year earnings has improved 14.2% over the past 60 days. SLAB sports a Zacks Rank #1 (Strong Buy). You can see Full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Technology Solutions MACOM Holdings, Inc. is a provider of analog power semiconductor solutions for various markets. MTSI develops and produces analog semiconductor RF, microwave and millimeter wave devices and components for optical, wireless and satellite network applications. MACOM Technology Solutions Holdings primarily serves three markets, namely Data Center, Industrial & Defense, and Telecommunications.

MACOM Technology’s expected earnings growth rate for the current year is 30.7%. The Zacks Consensus Estimate for current year earnings has improved 1.4% over the past 60 days. MTSI has a Zacks #2 rank (buy).

Taiwan Semiconductor Manufacturing Company Limited is the world’s largest dedicated IC foundry. As a foundry, TSM manufactures ICs for its customers based on its proprietary IC designs using its advanced production processes. Taiwan Semiconductor Manufacturing Company Limited’s goal is to establish itself as one of the world’s leading semiconductor companies by building on the strengths that have made it the world’s leading integrated circuit foundry.

Taiwan Semiconductor Manufacturing Company Limited’s expected earnings growth rate for the current year is 52.9%. The Zacks consensus estimate for current year earnings has improved 6.2% over the last 60 days. TSM sports a Zacks Rank #1.

STMicroelectronics N.V. is an independent global semiconductor company that designs, develops, manufactures and markets a broad range of semiconductor integrated circuits and discrete devices. STMS products are used in a wide variety of microelectronic applications, including telecommunications systems, computer systems, consumer products, automotive products, and industrial automation and control systems.

STMicroelectronics NV’s expected earnings growth rate for the current year is 70.8%. The Zacks consensus estimate for current year earnings has improved 10.8% in the last 60 days. STM sports a Zacks Rank #1.

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