If you’re a trend follower, you’re probably wondering what the market’s cool kids are buying.
Among semiconductors, four names stand out. Large-cap fund managers took more new stakes in Broadcom Ltd (NASDAQ: AVGO), Lam Research Corporation (NASDAQ: LRCX), Advanced Micro Devices, Inc. (NASDAQ: AMD) and NVIDIA Corporation (NASDAQ: NVDA) than in any other sector stocks throughout September, according to Bank of America Merrill Lynch.
A Closer Look
- Broadcom: With 31-percent ownership and the highest of relative weightings, Broadcom is both well-liked and well-owned. Still, it “is under-owned versus QCOM despite a higher market cap and benefits from multiple potential catalysts, including 40-percent iPhone content growth, accretive Brocade closure [and] large dividend boost,” analysts Vivek Arya, Adam Gonzalez and Wills Miller wrote in a Tuesday note.
- Lam Research: Although the firm saw the second greatest increase in ownership in September, it ranks in the bottom half of the peer group with just 15.7 percent of funds containing stakes.
- AMD: AMD is also relatively unpopular. Analysts called the stock “aggressively under-owned and neglected,” as just 4.2 percent of fund managers hold positions. AMD also has the lowest relative weight among chipmakers — even after posting the largest month-over-month weightings increase.
- Nvidia: Also considered under-owned, the firm has seen a significant increase in fund manager stakes over the last year, from 13 percent to 23 percent.
What They Didn’t Like
Although QUALCOMM, Inc. (NASDAQ: QCOM) continued to boast the most diverse ownership with stakes by 32.8 percent of fund managers, the stock conceded more owners than any other firm month-over-month.
Meanwhile, managers changed little in their positions on Microchip Technology Inc. (NASDAQ: MCHP), whose sales growth capacity Merrill Lynch considers underappreciated.
How The Industry Is Doing
Based on analyst assessment, semiconductor stocks are equal in weight with the overall tech sector; below electronic components, internet and software stocks; and moderately ahead of communications equipment, hardware and information technology stocks.
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Latest Ratings for AMD
|Jul 2017||Baird||Initiates Coverage On||Outperform|
|Jul 2017||BMO Capital||Downgrades||Outperform||Market Perform|
View More Analyst Ratings for AMD
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