Source: Golden Ten Data
Chip stocks such as Nvidia are receiving much attention, benefiting from artificial intelligence and other long-term trends, traders say.
Before the last earnings season arrived, Cantor Fitzgerald's analyst C.J. Muse (C.J. Muse) advised investors not to think too much. He said that the same suggestion was made this time, because the results of another batch of companies are about to be released.
Muse wrote, “The long-term benefits of artificial intelligence, combined with cyclical recovery in other fields, etc., tell us that there is still more room for growth in this industry.” He pointed out that it usually takes nine quarters to reach the peak of fundamentals. He recommended that investors continue to increase their holdings in chip and chip equipment stocks until earnings reports are announced.
In the context of not worrying too much, Muse will gain weight$NVIDIA (NVDA.US)$Stocks were listed as one of his best tactical suggestions for this earnings season. “Artificial intelligence is still going strong and should drive another round of strong growth,” he wrote.
Nvidia recently unveiled its new family of Blackwell chips, and the company is expected to contribute to the results later this year. According to Muse, Nvidia looked “an obvious first choice.” The company's earnings report will “serve as a catalyst for the continued rise in stock prices.” He rated the stock as an increase, with a target price of $1,200, and the stock has risen 78% so far this year.
Muse is still optimistic$Western Digital (WDC.US)$The company has released an optimistic performance forecast. “We're seeing a sharp drop in the company's solid-state drive inventory, combined with consumer recovery, which will drive demand far beyond supply for the rest of 2024, given the very low capital expenditure plans,” Muse wrote. He rated Western Digital's stock as an increase in holdings, with a target price of $100.
Muse is also optimistic about European chip equipment companies$ASML Holding (ASML.US)$Shares. “Management may emphasize that 2025 will continue to maintain the mid-range to high-end level of the target it has set,” he said. He pointed out that this target requires earnings of €30 to €36 per share, while the market generally expects €28.30, while its own target is €30.
He wrote: “Assuming a 35x increase above €33 (which is reasonable since investors are willing to allocate 25 times the price to a wider range of front-ends), we raise our target price to €1,150 (from €900).” Muse rated the stock as an increase in wealth.
In the end, he is$NXP Semiconductors (NXPI.US)$und$Qualcomm (QCOM.US)$The stock cheers. He expects NXP to show further resilience in its automotive business, and overall, the company has set itself a “very easy target to beat.” He is optimistic about Qualcomm's risk-reward balance as the company may benefit from$Samsung Electronics Co., Ltd. (SSNLF.US)$Optimistic trends related to the mobile phone business. He rated NXP shares as an increase, with a target price of $290, but his rating for Qualcomm is only neutral, with a target price of $190.
Editor/jayden