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The Zacks Analyst Blog Highlights: MACOM Technology Solutions, Maxim Integrated Products, Taiwan Semiconductor Manufacturing, Texas Instruments and Semtech

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Zacks Equity Research
·6 min read
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For Immediate Release

Chicago, IL – February 5, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: MACOM Technology Solutions Holdings, Inc. MTSI, Maxim Integrated Products, Inc. MXIM, Taiwan Semiconductor Manufacturing Company Limited TSM, Texas Instruments Incorporated TXN and Semtech Corporation SMTC.

Here are highlights from Thursday’s Analyst Blog:

Semiconductor Sales Rise Year Over Year: 5 Stocks to Buy

The global semiconductor industry has been one of the biggest beneficiaries of the pandemic that turned 2020 into a great year for microchip makers. This saw semiconductor sales jump year over year according to the Semiconductor Industry Association (SIA).

Growing demand for electronics, including smartphones, PC and the ongoing 5G boom gave a boost to semiconductor sales in 2020. And the situation is likely to stay so given the ongoing supply crunch in microchips due to soaring demand.

Global Semiconductor Sales Jump

Global semiconductor sales hit $439 billion in 2020, growing 6.5% from 2019's total of $412.3 billion. Also, global semiconductor sales came in at $39.2 in December, jumping 8.3% year over year and 2% from the prior month.

The semiconductor industry also had an impressive fourth quarter, wherein sales grew 8.3% to $117.5 billion compared to fourth-quarter 2019. Overall, fourth-quarter sales grew 3.5% from the third quarter.

Maximum growth was in the Americas in 2020, with a sales increase of 19.8%. Annual sales also increased 1% and 5.3% in Japan and Asia Pacific, respectively, but declined 6% in Europe.

5G Smartphones, PC Demand Drive Sales

Strong sales of 5G smartphones help have been driving microchip sales despite the overall slowdown in the smartphone market. Besides, demand for microchips got a boost from the 5G boom in Europe and some countries in Asia, including China and Singapore.

In fact, demand for consumer electronic goods during the pandemic has resulted in a supply crunch for microchips. Moreover, carmakers, which have been trying to bounce back after taking a beating during the pandemic, are now faced with another roadblock in the form of a shortage in the supply of semiconductors.

Microchips are an important part of both the auto industry as well as the infotainment industry. The recovery of the automotive sector was faster than projected, due to pent-up demand during the shutdown period, which is now hampering the balance between demand and supply.

The supply shortage is a sign that microchips are in high demand and the situation is likely to remain so.

Our Choices

The semiconductor market is likely to continue thriving in 2021. Below are five chip stocks that investors can gain from in the current scenario.

MACOM Technology Solutions is a provider of power analog semiconductor solutions to varied markets. The company develops and produces analog radio frequency, microwave and millimeter-wave semiconductor devices, and components for applications in optical, wireless and satellite networks.

The company's expected earnings growth rate for the current year is 89.8%. The Zacks Consensus Estimate for current-year earnings has improved 14.1% over the past 60 days. MACOM Technology Solutions carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Maxim Integrated Products is an original equipment manufacturer of semiconductor analog and mixed-signal integrated circuits. The company has a broad product portfolio that includes analog-to-digital converters, amplifiers and comparators, communications devices, data converters, and management components, sensors and wireless products.

The company's expected earnings growth rate for the current year is 31.9%. The Zacks Consensus Estimate for current-year earnings has improved 5.7% over the past 60 days. Maxim Integrated Products holds a Zacks Rank #2.

Taiwan Semiconductor Manufacturing is the world's largest dedicated integrated circuit foundry. It manufactures proprietary IC designs using its advanced production processes.  

The company's expected earnings growth rate for the current year is more than 18.3%. The Zacks Consensus Estimate for current-year earnings has improved 9.3% over the past 60 days. Taiwan Semiconductor has a Zacks Rank #2.

Texas Instruments is an original equipment manufacturer of analog, mixed-signal and digital-signal processing integrated circuits.

The company's expected earnings growth rate for the current year is 12.1%. The Zacks Consensus Estimate for current-year earnings has improved 14.8% over the past 60 days.Texas Instruments carries a Zacks Rank #2.

Semtech manufactures and markets a wide range of analog and mixed-signal semiconductors for commercial applications.

The company's expected earnings growth rate for the current year is more than 13.8%. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the past 60 days. Semtech Corporation has a Zacks Rank #2.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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Semtech Corporation (SMTC) : Free Stock Analysis Report
 
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Taiwan Semiconductor Manufacturing Company Ltd. (TSM) : Free Stock Analysis Report
 
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