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Tuesday, May 9, 2023The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Eli Lilly and Company (LLY), Verizon Communications Inc. (VZ) and United Parcel Service,

AMD (NASDAQ: AMD) and Qualcomm (NASDAQ: QCOM) both saw their stocks close at record highs in late 2021. At the time, both semiconductor companies seemed poised to profit from the global chip shortage. The buying frenzy in growth stocks throughout the year amplified their gains an

Advanced Micro Devices (NASDAQ: AMD) stock got a reality check after the release of the company's first-quarter 2023 results on May 2, as investors pressed the panic button and brought the chipmaker's impressive rally to a temporary halt.

TSMC (NYSE: TSM) and Intel (NASDAQ: INTC) are often compared to each other, but the two chipmaking giants operate very different business models. TSMC is the world's largest third-party contract chipmaker, and it only manufactures chips for "fabless" chipmakers like AMD (NASDAQ:

GlobalFoundries Inc projected quarterly revenue below estimates on Tuesday as the chip manufacturer takes a hit from slumping sales of smartphones and other consumer electronics, sending its shares down nearly 5% in premarket trading.

Intel (NASDAQ:INTC) Q1 2023 results saw a sharp decline versus last year, although they came in better than market expectations. Sales declined by about 36% year-over-year to $11.7 billion as both the company’s Data Center and PC businesses faced headwinds. The company also

Semiconductor stocks were taken to the cleaners in 2022, as concerns about oversupply hit the industry at the same time when rising interest rates hit tech and growth stocks particularly hard. The iShares Semiconductor ETF ( NASDAQ:SOXX) fell by 35.1% last year. However, the industry is bouncing back in 2023, and SOXX is back with a vengeance, to the tune of a 20.7% rebound year-to-date. Meanwhile, SOXX continues to look compelling over the long term, even after this run-up, which is why investors should consider putting this ETF on their watch lists. What is SOXX ETF? SOXX is an ETF from BlackRock’s ( NYSE:BLK ) iShares that invests in “an index composed of U.S.-listed equities in the semiconductor sector,” according to iShares. It has over $7 billion of assets under management and a reasonable expense ratio of 0.35%. SOXX ETF also pays a dividend, but with a yield of 1.1%, this is more of just an added bonus rather than a key reason to invest in this ETF.  Semiconductor Stocks are Still Attractive for the Long Term  While the price of SOXX and semiconductor stocks will fluctuate over the short term based on supply and demand for semiconductors and on the earnings results of individual companies, over the long term, the semiconductor space is still attractive, with powerful secular growth drivers behind it. Intel ( NYSE:INTC ) forecasts that the semiconductor market will grow to $1 trillion annually by the end of this decade, up from $570 billion in 2022.  Semiconductors are going into more products than ever before, from smartphones to cars and refrigerators, as more devices become connected. Meanwhile, the latest technological advances like self-driving cars, machine learning, and artificial intelligence (AI) are driving the need for more chips (and increasingly advanced ones). Nvidia ( NASDAQ:NVDA ) is building its own large language models to train AI chatbots and partnering with Microsoft ( NASDAQ:MSFT ) to build a cloud supercomputer to facilitate AI workloads. Gamers and Bitcoin ( BTC-USD ) miners alike both drive demand for graphics processing units (GPUs) from the likes of Nvidia and Advanced Micro Devices ( NASDAQ:AMD ). SOXX's Holdings Now that we've given an overview of the long-term outlook for the semiconductor industry, let's take a closer look at the SOXX ETF itself. To be blunt, SOXX is not particularly diversified. It only holds 31 stocks, and its top 10 holdings account for nearly 60% of the fund. Now, if you’re bullish on semiconductors and making a long-term bet on them, this certainly isn’t a bad thing, as it gives you plenty of undiluted exposure to semiconductors. However, one thing to note is that the top holding, Nvidia, makes up nearly 10% of assets. Again, this isn’t necessarily a negative, but investors should be aware that they are going to have a lot of exposure to Nvidia, both to the upside and downside. If Nvidia reports great earnings or unveils a new way its chips are being used to advance AI technology, SOXX would likely do well. On the other hand, if Nvidia releases a bad earnings report, SOXX would likely suffer. That’s just the nature of the beast when investing in an ETF like this, as Nvidia is the world’s largest chip company (by market cap) and the sixth-largest company overall, with a massive market cap of over $700 billion.  Additionally, second-largest holding Broadcom ( NASDAQ:AVGO ) and third-placed Texas Instruments ( NASDAQ:TXN ) also account for large portions of the fund. Further, Advanced Micro Devices and Qualcomm ( NASDAQ:QCOM ) each have weightings of over 5%. Below, you’ll find a snapshot of SOXX’s top holdings. As you can see, what SOXX lacks in diversification, it makes up for in supercharged Smart Scores. The Smart Score is TipRanks’ proprietary quantitative stock scoring system that evaluates stocks on eight different market factors. The result is data-driven and does not require any human intervention. A Smart Score of 8 out of 10 or above is the equivalent of an Outperform rating, and as you can see above, 7 of SOXX’s top 10 holdings feature scores of 8 or above, while Nvidia boasts a 'Perfect 10' rating. Other positions outside the top 10, such as ASML Holding N.V. ( NASDAQ:ASML ) and Lattice Semiconductor ( NASDAQ:LSCC ), join Nvidia with Perfect 10 Smart Scores. As stated above, it’s not always a bad thing to feature a large concentration in a handful of top few holdings, as these are some high-quality names with laudable Smart Scores. SOXX itself has an ETF Smart Score of 8 out of 10. Is SOXX Stock a Buy, According to Analysts? While SOXX stock boasts some strong Smart Scores, sell-side analysts are also fairly bullish on it, with a Moderate Buy consensus rating from analysts. The average SOXX stock price target of $489.60 represents upside potential of 17.5% from its current price. Of the 450 analyst ratings on SOXX, 65.6% are Buys, 30.2% are Holds, and 4.2% are Sells.  Cheaper Than You Might Expect SOXX is also cheaper than one might expect, especially for a portfolio of companies developing the cutting-edge products and technologies that much of the modern world and global economy rely upon. SOXX’s holdings have an average price-to-earnings ratio of 19.35. While this isn’t so cheap that value investors are going to be pounding the table for it, it’s still a discount to the broader market -- the S&P 500 ( SPX ) currently trades at an average price-to-earnings multiple of 23.9. Given the importance of these companies, the long-term demand for their products, and the advances they continually make, I find this discount (albeit a slight one) surprising, and it adds to SOXX’s investment appeal.  Some of the individual names within SOXX’s top holdings trade for even more attractive valuations, such as Broadcom at 15.2 times earnings and Lam Research ( NASDAQ:LRCX ) at 16 times earnings. The valuations of many of these semiconductor names are cheaper than those of many consumer staple companies. While many top consumer staples giants have been great stocks and feature stable businesses, they don't offer the same long-term growth potential as you'll find in the semiconductor space. John Mowrey, the CIO of NFJ Investment Group, has highlighted this gap in valuations, comparing top semiconductor names like these to Hershey ( NYSE:HSY ), which is a great company, but trades at a much steeper 28.9 times earnings. In Mowray's words, "If you're going to choose between chocolate chips and semiconductor chips, we prefer the semiconductor chips." Conclusion SOXX is not very diversified, but it does give investors concentrated exposure to the continued long-term growth of the semiconductor industry, which is a compelling long-term story. SOXX’s portfolio features a bevy of high-quality semiconductor names with strong Smart Scores, and analysts also view SOXX favorably. SOXX features a reasonable expense ratio of 0.3% and looks like a promising long-term holding based on the secular tailwinds the semiconductor industry should enjoy well into the future. Disclosure

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Investors in Advanced Micro Devices Inc (Symbol: AMD) saw new options become available today, for the November 17th expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value, so with 193 days until expiration the newly

Advanced Micro Devices (AMD) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Below is Validea's guru fundamental report for ADVANCED MICRO DEVICES, INC. (AMD). Of the 22 guru strategies we follow, AMD rates highest using our Value Investor model based on the published strategy of Benjamin Graham. This deep value methodology screens for stocks that have l

The artificial intelligence (AI) market is currently valued at $208 billion and is projected to jump more than 780% to $1.8 trillion by 2030, according to Statista. That immense potential market attracted the attention of many of the world's most valuable companies, all hoping to

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

Advanced Micro Devices (NASDAQ: AMD) stock has plunged nearly 10% since May 2, with the decline mainly driven by weak second-quarter 2023 guidance. The company posted first-quarter 2023 revenue of $5.4 billion, beating Wall Street expectations by $40 million. However, the positiv

United States Steel became the world's first $1 billion company in 1901, and it took a full 117 years before Apple was crowned the first-ever $1 trillion company in 2018.

Advanced Micro Devices (NASDAQ: AMD) has numerous data center products expected to be released later this year to help fuel the artificial intelligence (AI) battle by big tech. Check out the short video to learn what semiconductor investors Jose Najarro and Nicholas Rossolillo ha

Shares of semiconductor company Advanced Micro Devices (NASDAQ: AMD) peaked in late 2021 at around $160. Since then, the semiconductor industry has shifted hard from shortages to gluts. Demand for PCs has crashed, and excess inventories are further pushing down orders for AMD's c

As everybody knows by now, artificial intelligence (AI) has been Wall Street’s shiny new toy in 2023, with companies speaking on the technology in a snowballing fashion.