3 Budget Semiconductor Stocks to Own Before the 2024 Crypto Bull Run
Budget semiconductor stocks are set for a boost with Bitcoin’s (BTC-USD) long-anticipated halving event scheduled to take place in April. The halving is a cyclical event in which the scarcity of Bitcoin is increased as the volume of cryptocurrency awarded to miners is halved. Many investors are expecting market-wide rallies that are similar in scale to the 2021 bull run.
“If ETF-related inflows materialize as we expect, we think an end-2025 level closer to USD 200,000 is possible,” explained Geoff Kendrick, head of digital assets at Standard Chartered.
So where does the semiconductor industry factor in a crypto bull run? The demand for semiconductors increases during crypto bull runs due to the increased need for a high computing power. The semiconductor market is already enjoying an impressive rally off the back of 2023’s generative artificial intelligence (AI) boom. By powering the cryptocurrency mining revival this year, we will see sustained growth and the emergence of fresh market players throughout the year.
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For some budget semiconductor stocks that may have room to grow, it’s worth considering the following three options.
Taiwan Semiconductor Manufacturing (TSM)
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Taiwan Semiconductor Manufacturing (NYSE:TSM), or TSMC, is the world’s largest semiconductor operator, boasting a 56% market share.
Despite its advantageous market position, TSMC was overshadowed by Nvidia (NASDAQ:NVDA) in 2023. Consequently, there’s ample opportunity for the stock to benefit from heightened investor demand during the crypto bull run.
TSMC has been actively countering potential risks stemming from geopolitical tension between China and Taiwan by building new locations across the globe.
The company’s revenue forecasts for 2024 anticipated 25% growth, so there’s plenty for investors to be excited about. With more crypto miners set to seek out semiconductor solutions to support their operations, we’ll see TSMC’s status as a market leader place the firm in good stead.
Intel (INTC)
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Computing giant Intel (NASDAQ:INTC) has endured a volatile start to 2024. After sales and profitability forecasts fell far below Wall Street expectations, the stock tumbled 12% at the end of January — its largest decline in over three years.
Despite this, the stock quickly recovered its losses. Bank of America analysts suggesting that Intel Foundry Services (IFS) could position itself as a leading alternative to TSMC drove Intel’s rebound.
While TSMC’s position as a market leader is strong, geopolitical tensions between China and Taiwan may push more customers towards IFS.
The custom chip market topped $30 billion in 2023. The generative AI boom, coupled with renewed interest in cryptocurrency mining, could form the perfect storm for Intel’s growing expansion into the 2024 world of semiconductors.
Axcelis (ACLS)
Source: Pavel Kapysh / Shutterstock.com
Unlike the other semiconductor stocks we’ve looked at in this article, Axcelis (NASDAQ:ACLS) doesn’t produce chips itself. Rather, this stock manufactures ion implantation equipment that plays a major role in the creation of chips. Axcelis produces semiconductor hardware like storage (NAND) chips, memory (DRAM) chips and advanced logic (CPU) chips.
In 2023, Axcelis reportedly experienced exceptional demand in the silicon-carbide power device market. The company had a major $1.2 billion order backlog, amounting to the equivalent of a year’s worth of revenue.
With a market cap of less than $5 billion, Axcelis is a relatively small company that’s ripe for growth. As the demand for ion implantation grows amidst the crypto boom, we could see Axcelis achieve exceptional numbers.
On the date of publication, Dmytro Spilka did not hold (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.
Dmytro is a finance and investing writer based in London. He is also the founder of Solvid, Pridicto and Coinprompter. His work has been published in Nasdaq, Kiplinger, FXStreet, Entrepreneur, VentureBeat and InvestmentWeek.
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