In the past few weeks, semiconductor stocks have been under a lot of pressure. However, big names are pulling back on Friday.
The stock price of Nvidia Corp. (NVDA) is up 2.9% this morning, while the stock price of Advanced Micro Devices Inc. (AMD) is up 1.8%. MU’s stock price went up by 2.42 percent today.
is also ahead 1.8%. Before Friday, all three had three sessions in a row of declines.
As of the start of the day, the PHLX Semiconductor Index SOX 2.65% is up 2.1%.
But are stocks in semiconductors safe? An analyst at Mizuho who works from a desk says not yet. He called attention to the VanEck Semiconductor ETFs.
The SMH fell 2.28 percent, or 16 percent, from its highs to Thursday’s close. Afterward, he thinks the sector will go down by about 5% to 7%.
Klein told his clients on Friday that he doesn’t think it’s safe to say that the worst is over and that it’s time to buy semis. “The short-lived turn around at the beginning of the week didn’t last long, and we broke down hard and fast because of worries about Alphabet’s likely flat capital expenditures and guidance downs in auto/industrial analog and some back-end test and packaging companies.”
He said that they should wait until they hear more from Microsoft Corp.
Next week, Microsoft (MSFT) will report earnings, Meta Platforms Inc. (META) will report earnings, and Amazon.com Inc. (AMZN) will report earnings. It’s also possible that investors should wait a little longer.
It’s better for him to wait until later in August and closer to [Nvidia] earnings before jumping back into bigger semi-longs, he wrote. “Too much depends on how [Nvidia’s] earnings and guidance look in a month.” A report from Nvidia is due on August 28.
In the meantime, next week will bring two important reports for investors in the semiconductor industry. Tuesday is AMD’s day, and Wednesday is Intel Corp.
On Thursday, INTC 1.11% will report.
Analyst Stacy Rasgon of Bernstein says that Intel’s stock “still seems to be in no-man’s land to us.” He said that the company’s “AI story still feels mostly MIA” because $500 million in sales in the second half would be “more than zero, but not much more.”
He said this about AMD: “The burgeoning AI story may not be living up to expectations, and is somewhat offset by core business weakness.”
