Zacks Analyst Blog Features MaxLinear, Advanced Micro Devices, United Microelectronics and NXP Semiconductors

For immediate release

Chicago, IL – March 7, 2022 – Zacks.com announces the list of stocks featured in the analyst blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured in the blog include: MaxLinear MXL, Advanced Micro Devices AMD, United Microelectronics UMC and NXP Semiconductors NXPI a.

Here are highlights from Friday’s analyst blog:

4 top semiconductor stocks to buy amid rising war tensions

The global chip shortage, which has been a headwind since the start of the coronavirus pandemic, is set to worsen due to the ongoing war between Russia and Ukraine.

Notably, the war has further disrupted the supply chain, as both countries control the supply of raw materials needed to manufacture semiconductors.

Nevertheless, the impacts of the Russian-Ukrainian conflict should be limited because most semiconductor companies have kept their raw materials stocked and diversified their supply. Additionally, the US and UK would have the potential to reduce the risk of another chip shortage as they are major suppliers of some of the key raw materials.

Apart from this, the growing demand for consumer electronics, automotive, industrial tools and equipment, and networking and communication products is expected to act as a tailwind for the semiconductor industry.

Learn more about growth prospects

Remote work and e-learning trends caused by the coronavirus pandemic have boosted demand for processors used in enterprise laptops and data center servers. This, in turn, acts as a key catalyst for the growth of the industry.

The growing demand for autonomous and electric vehicles remains another tailwind. The increasing adoption of recent technologies like Internet of Things, Artificial Intelligence, and Virtual Reality by various industries like healthcare, defense, and retail is also helping the semiconductor space.

The aforementioned factors are expected to continue driving the growth of the industry highlighted in the short term, as well as the long term.

Notably, the Precedence Research report indicates that the semiconductor market will reach $808.5 billion by 2030 from $430 billion in 2021, with a CAGR of 6.6% between 2021 and 2030.

The impressive performance of the semiconductor industry in January 2022 testifies to the aforementioned factors.

According to the latest report from the Semiconductor Industry Association, global semiconductor industry sales were $50.7 billion for January 2022, up 26.8% year over year. . However, sales fell slightly by 0.2% compared to the previous month.

Apart from that, the broader iShares PHLX Semiconductor ETF, which measures the performance of the US stock market’s semiconductor industry, gained 16.4% year on year. Additionally, ProShares Ultra Semiconductors ETF gained 37.5% over the same period.

Stocks to buy

Considering the factors mentioned above, here we have selected four semiconductor stocks that have strong fundamentals, and the combination of a Zacks No. 1 (strong buy) or 2 (buy) rating and a score growth of A or B. You can see the full list of today’s Zacks #1 Rank stocks here.

MaxLinear continued to benefit from the good momentum in broadband access, connectivity, infrastructure and industrial multimarkets. Growing platform design gains across multiple geographies in new end markets also continue to benefit the company.

In addition to this, MXL is constantly striving to bring advanced solutions to gain traction with customers. It recently introduced a fully integrated SoC named Sierra for 4G/5G Open RAN radio units. In addition, the company’s MxL1600 family of RF transceivers has been selected by a leading wireless network solution provider, ZHT, for its 5G remote radio small cells. This remains another favorable wind for the company.

MaxLinear, currently sporting a Zacks No. 1 ranking, has a growth score of A. MXL stock has gained 72.4% year-over-year. The company’s long-term earnings growth rate is currently projected at 20%.

Advanced micro-systems benefited from the solid performance of the IT and Graphics, and Enterprise Embedded and Semi-Custom segments. It has benefited from strong sales of Ryzen and EPYC server processors, due to the growing proliferation of artificial intelligence and machine learning in industries such as cloud, gaming and supercomputing domain. Recently, its third-generation EPYC processors were selected by Google Cloud to power new C2D instances for high-performance memory-bound workloads. This remains a positive factor for AMD.

Other than that, the growing influence of seven-nanometer products in the data center vertical, driven by work-from-home and e-learning trends, remains a key enabler for AMD. The company’s recent acquisition of Xilinx to bolster its data center business remains another notable milestone.

Advanced Micro Devices, currently boasting a No. 1 Zacks ranking, has a growth score of B. AMD stock has returned 42.8% over the past year. The stock’s long-term earnings growth rate is currently projected at 29.1%.

United Microelectronics has consistently gained traction with customers through its comprehensive portfolio of technology offerings. Additionally, increasing wafer shipments are contributing well to revenue growth. In addition, UMC’s 28 nanometer technologies boost overall wafer ASP (Average Selling Price). This remains a positive point.

The growing adoption of 5G phones, electric vehicles, and Internet of Things-based devices is creating demand for silicon content. This, in turn, increases foundry demand. Thus, the company’s strengthening position in foundry capacity remains a tailwind.

United Microelectronics, which currently holds the Zacks No. 2 ranking, has a growth score of A. Additionally, UMC stock has gained 10.6% year on year. The stock’s long-term earnings growth rate is currently projected at 29%.

NXP Semiconductors benefited from its strong position in secular growth markets including automotive, industrial and IoT and communications infrastructure. Strong momentum in RF power for base stations remains another tailwind. Additionally, the company’s growing efforts to develop an improved 5nm design strategy, with the aim of increasing the software performance required in future cars, remains positive.

On top of that, NXPI is constantly gaining momentum in the 5G market with its robust technology and solutions. Growing deployments of 5G networks are driving the growth of its communications business. Additionally, its Layerscape processors were recently selected by Compal Electronics to enhance 5G-integrated small cell solutions for 5G network deployments. This remains a tailwind for NXPI.

NXP Semiconductors, which currently holds a No. 2 Zacks ranking, has a growth score of B. NXPI stock has returned 2.1% over the past year. The stock’s long-term earnings growth rate is currently projected at 22%.

Just Released: Zacks Top 10 Stocks for 2022

In addition to the investment ideas discussed above, would you like to know our top 10 picks for all of 2022?

From its creation in 2012 to 2021, the Zacks Top 10 Stocks portfolios gained an impressive +1,001.2% vs. +348.7% for the S&P 500. Now our research director has combed through 4,000 companies covered by the Zacks Ranking and selected the top 10 tickers to buy and keep. Don’t miss your chance to enter…because the sooner you do, the better your chances of winning.

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

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Advanced Micro Devices, Inc. (AMD): Free Inventory Analysis Report

NXP Semiconductors NV (NXPI): Free Stock Analysis Report

United Microelectronics Corporation (UMC): Free Inventory Analysis Report

MaxLinear, Inc (MXL): Free Stock Analysis Report

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