In 2020, semi-conductor inventories showed strong growth, but analysts expect their growth would accelerate in 2021. Analyst at major investment firm, Evercore ISI single out one of the most promising semiconductor stock.
3 Tiny Stocks Primed to Explode
The world's greatest investor — Warren Buffett — has a simple formula for making big money in the markets. He buys up valuable assets when they are very cheap. For stock market investors that means buying up cheap small cap stocks like these with huge upside potential.
We've set up an alert service to help smart investors take full advantage of the small cap stocks primed for big returns.
Click here for full details and to join for free
Sponsored
For the larger S&P 500, the NASDAQ Composite Index ends in 2020 with double-digit gains. While the NASDAQ Composite is up 38.64 percent since the beginning of the year, the S&P 500 is up 12.9 percent in 2020, the Dow Jones index is up 4.64 percent, with just 30 blue-chip stocks.
The COVID-19 pandemic has disrupted supply chains and impacted demand, but over the past three quarters, major semiconductor firms have posted better than expected financial results.
A huge rapid transition to digital technologies has benefited semiconductor firms, as companies, staff, schools and students have had to transfer their work online. As there was a rise in demand for software for remote work, testing, and communication, and a surge in sales of computers and other equipment, the data centre market, video games, and the needs of technology companies increased.
Evercore ISI investment bank analyst C. J. Muse claims that semiconductor inventories are projected to rise for six to eight quarters. “Despite another year of outperformance in 2020, we think the growth cycle of semiconductor stocks is just beginning,” said analyst C. J. Muse. Evercore estimates that the revenues of the global semiconductor industry will rise by 14 percent to $500 billion in the first half of 2021.
Seven semiconductor stocks that the company named as its ‘favorites’ were included in the Evercore investment forecast for 2021: Nvidia (NVDA), Analog Devices (ADI), Micron Technology (MU), Qualcomm (QCOM), ASML (ASML), Applied Materials (AMAT) and Teradyne (TER).
Nvidia shares were explicitly singled out by analyst C. J. Muse, raising their target price from $600 to $675. Since the beginning of the year, NVIDIA shares have increased more than 126 percent, and over the past four quarters, the company has reported solid revenue and profit growth. The target price implies a medium term growth of 30%, and in the event of mean target price of $592 the short term gain would be of about 13%.
