Top 10 U.S. Semiconductor Stocks to Watch in 2023

What is the fastest growing semiconductor company in the U.S.?

The fastest growing semiconductor company in the U.S. is Advanced Micro Devices ($AMD), judging by sales growth. AMD sales grew from US$6.33b in 2018 to US$23.06b in 2022, almost quadrupling its revenue in the short period of five years.

Top 10 semiconductor stocks in the U.S.

Data as of 3 May 2023.

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Watch these semiconductor companies from the U.S. stock market

1. Nvidia Corporation ($NVDA)

Market capitalisation: US$686.70b

Stock price (as of 03/05/2023): US$278.02

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 47% / 53%

Nvidia Corporation ($NVDA) is a US-based technology company that designs and manufactures high-performance graphics processing units (GPUs) and system-on-a-chip (SoC) units for use in gaming, professional visualisation, and artificial intelligence (AI) applications. Nvidia operates globally and differentiates itself from its competitors through its focus on GPU-accelerated computing, its proprietary CUDA parallel computing platform, and its development of specialised AI chips such as the Tensor Core GPU.

2. Broadcom Inc. ($AVGO)

Market capitalisation: US$255.65b

Stock price (as of 03/05/2023): US$613.20

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 54% / 46%

Broadcom Inc. ($AVGO) is a global semiconductor and infrastructure software company that produces a wide range of products for use in data centres, networking, wireless communications, and storage. The company's products include chips, adapters, and software for use in these areas. It stands out from the competition through its extensive patent portfolio, its focus on high-performance networking and storage solutions, and its acquisition of other companies to expand its product offerings.

3. Texas Instruments Incorporated ($TXN)

Market capitalisation: US$148.26b

Stock price (as of 03/05/2023): US$163.65

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 62% / 38%

Texas Instruments Incorporated ($TXN) is a US-based semiconductor company that produces a wide range of analog and embedded processing chips for use in various industries, including automotive, industrial, and personal electronics. Texas Instruments operates globally and sets itself apart through its focus on high-quality analog and embedded processing products, its broad customer base across a wide range of industries, and its emphasis on research and development to stay at the forefront of technological innovation.

4. Advanced Micro Devices, Inc. ($AMD)

Market capitalisation: US$131.35b

Stock price (as of 03/05/2023): US$81.62

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 50% / 50%

Advanced Micro Devices, Inc. ($AMD) is a US-based semiconductor company that produces a variety of microprocessors, graphics processors, and other specialised chips for use in personal computers, gaming consoles, and data centres. AMD operates globally and is characterised by its focus on providing high-performance chips at competitive prices, its emphasis on research and development to innovate new products, and its partnerships with other companies in the industry.

5. Qualcomm Incorporated ($QCOM)

Market capitalisation: US$125.80b

Stock price (as of 03/05/2023): US$112.83

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 54% / 46%

Qualcomm Incorporated ($QCOM) is a US-based semiconductor and telecommunications equipment company that produces chips and other hardware for use in smartphones, laptops, and other mobile devices. Qualcomm operates globally and is known for its focus on mobile computing and wireless technology, its extensive patent portfolio related to cellular technologies, and its partnerships with other companies in the industry.

6. Intel Corporation ($INTC)

Market capitalisation: US$127.84b

Stock price (as of 03/05/2023): US$30.65

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 65% / 35%

Intel Corporation ($INTC) is a US-based semiconductor company that produces a wide range of microprocessors, memory chips, and other specialised chips for use in personal computers, data centres, and other applications. Intel operates globally and differentiates itself through its focus on high-performance computing and its emphasis on research and development to innovate new products.

7. Analog Devices, Inc. ($ADI)

Market capitalisation: US$92.26b

Stock price (as of 03/05/2023): US$182.39

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 51% / 49%

Analog Devices, Inc. ($ADI) is a US-based semiconductor company that produces analog and digital signal processing chips for use in various industries, including automotive, industrial, and consumer electronics. Analog Devices operates globally and focuses on high-quality analog and digital signal processing products, with extensive expertise in various industries, and a core emphasis on research and development to innovate new products.

8. Micron Technology, Inc. ($MU)

Market capitalisation: US$66.65b

Stock price (as of 03/05/2023): US$60.91

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 56% / 44%

Micron Technology, Inc. ($MU) is a US-based semiconductor company that produces memory chips and other specialised chips for use in various industries, including personal computers, smartphones, and data centres. Micron Technology operates globally and focuses on high-performance memory solutions, with extensive experience in the memory chip industry, and emphasis on research and development to innovate new products.

9. KLA Corporation ($KLAC)

Market capitalisation: US$52.36b

Stock price (as of 03/05/2023): US$378.17

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 69% / 31%

KLA Corporation ($KLAC) is a US-based semiconductor equipment company that produces specialised equipment for use in the semiconductor manufacturing process, including inspection, metrology, and process control systems. KLAC operates globally and sets itself apart through its focus on specialised semiconductor manufacturing equipment, its extensive expertise in the semiconductor industry, and its emphasis on research and development to innovate new products.

10. Microchip Technology Incorporated ($MCHP)

Market capitalisation: US$41.76b

Stock price (as of 03/05/2023): US$76.25

Stake platform bought / sold (1 Jan 2023 - 3 May 2023): 49% / 51%

Microchip Technology Incorporated ($MCHP) is a US-based semiconductor company that produces a variety of microcontrollers, analog and digital signal processing chips, and other specialised chips for use in various industries, including automotive, aerospace, and consumer electronics. Microchip Technology operates globally and stands out from the competition through its focus on providing high-quality, low-power consumption products at competitive prices, its strong position in the microcontroller market, and its acquisition of other companies to expand its product offerings. Additionally, Microchip Technology has a reputation for providing excellent customer support and maintaining long-term relationships with its customers.

What small-cap semiconductor stocks are worth watching?

Some small-cap semiconductor stocks that might be worth watching are Rambus Inc ($RMBS), ON Semiconductor Corporation ($ON) and Lattice Semiconductor Corporation ($LSCC), as they've shown EBITDA growth above 50% in the last fiscal year.

Rambus ($RMBS) is a semiconductor and intellectual property company that designs and licenses technologies to the electronics industry. Their technologies include memory and interface technologies, security and cryptography technologies, and chip and system architecture.

ON Semiconductor Corp. ($ON) designs and manufactures a range of semiconductor components, including power management, analog, and sensors. These components are used in a variety of industries, including automotive, industrial, and communications.

Lattice Semiconductor Corp ($LSCC) designs and manufactures programmable logic devices, including field-programmable gate arrays (FPGAs) and complex programmable logic devices (CPLDs). These devices are used in a variety of applications, including communications, computing, and industrial automation.

What are the top performing semiconductor ETFs?

The three best performing semiconductor ETFs of the past five years are the SPDR S&P Semiconductor ETF ($XSD), the VanEck Vectors Semiconductor ETF ($SMH) and the iShares PHLX Semiconductor ETF ($SOXX), returning respectively +21.94%, +21.52% and +20.59% to its investors during the period.

The SPDR S&P Semiconductor ETF ($XSD) invests in small-cap semiconductor stocks that are included in the S&P Total Market Index. This ETF provides exposure to a diverse range of semiconductor companies and includes both U.S. and non-U.S. companies. One standout feature of XSD is that it includes smaller semiconductor stocks that may have more growth potential than larger, more established companies.

The VanEck Vectors Semiconductor ETF ($SMH) invests in companies that primarily produce semiconductors and semiconductor equipment. This ETF is heavily weighted towards large-cap companies, with the top ten holdings accounting for the majority of the portfolio. One standout feature of SMH is its focus on large-cap companies, which may provide more stability and a more established track record than smaller market cap companies.

The iShares PHLX Semiconductor ETF ($SOXX) invests in U.S. companies that produce semiconductors, semiconductor equipment, and semiconductor materials. This ETF includes both large-cap and mid-cap companies and provides exposure to companies across the semiconductor technology sector itself, including memory, microprocessors, and graphic processors. One standout feature of SOXX is its focus on U.S. companies, which may be beneficial for investors who prefer to invest in American companies.

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Semiconductor stocks FAQs

Are semiconductor stocks a good investment?

Semiconductor stocks have some advantages for investors, including the high growth potential of the industry. The increasing demand for semiconductors is driven by the growing use of technology in various industries, such as the Internet of Things (IoT), autonomous vehicles, and 5G technology. Many semiconductor companies have strong financials, including high revenue growth and profits, which can be attractive to investors. Additionally, the industry is diverse, which can provide investors with a diversified portfolio.

However, there are also several disadvantages to investing in semiconductor stocks. The semiconductor industry is cyclical and heavily dependent on global economic conditions. During economic downturns, demand for semiconductors can decrease, resulting in decreased revenue and profitability for companies.

Which country has the most chip manufacturers?

The U.S. is the country with the highest number of chip manufacturers. However, it is not the country responsible for most of the global production despite being the birthplace of the semiconductor industry. The title of the biggest chip manufacturer belongs to Taiwan, mostly due to the Taiwan Semiconductor Manufacturing Company ($TSM). Taiwan Semiconductor Manufacturing Company is the biggest player in the sector worldwide, followed by Korean manufacturer Samsung.

Who makes semiconductors in Australia?

There are several companies that manufacture semiconductors in Australia, though the country's semiconductor industry is relatively small compared to other major semiconductor-producing countries.

One of the largest semiconductor manufacturers in Australia is Silanna Group, which is headquartered in Sydney and specialises in developing and producing power management solutions and integrated circuits for a wide range of applications. Another significant player in the Australian semiconductor sector is Cogent, which is based in Melbourne and develops and manufactures a variety of semiconductor components, including microprocessors, memories, and analog/digital ICs.

Other semiconductor companies operating in Australia include Austriamicrosystems (an Austrian-based semiconductor manufacturer with a presence in Australia), Microchip Technology (a US-based semiconductor company with an Australian office), and STMicroelectronics (a multinational semiconductor manufacturer with a design centre in Sydney). However, it's worth noting that many Australian semiconductor companies also operate in other parts of the world and may not exclusively focus on manufacturing in Australia.

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This does not constitute financial product advice nor a recommendation to invest in the securities listed. Past performance is not a reliable indicator of future performance. As always, do your own research and consider seeking appropriate financial or taxation advice before investing.