Chip maker stocks on the rise

Munich The excavators are rolling: Texas Instruments plans to start building two new factories in its home country next year. The seventh largest chip manufacturer in the world announced that two more plants could be added later in north Texas. The US company will invest up to 30 billion dollars in the small town of Sherman, said CEO Rick Templeton.

Like Texas Instruments, semiconductor companies are gearing up for a rapidly growing business worldwide. There is nothing to indicate the threat of a crash, which has usually followed every upswing in the industry in recent years.

For the rest of the year, investors and employees don’t have to worry. A look at the latest publications shows that: Almost all of the major chip manufacturers forecast a robust increase in sales for the fourth quarter. And things are looking good for 2022 as well. Therefore, the chip stocks could continue to rise – regardless of the already strong price increases in the course of the year so far.

Take Qualcomm, for example: The world’s largest cell phone chip provider is anticipating a 16 percent increase in sales for the new fiscal year that began on September 27th. That is not a matter of course, because in the past fiscal year, revenues climbed by 55 percent, to $ 33.6 billion. Even more: the US group has become significantly more profitable in the last financial year. The profit has more than doubled to almost ten billion dollars.

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The group does not fear a lull in the foreseeable future. Revenue could rise to $ 46 billion by 2024, said CFO Akash Palkhiwala last week. Analysts had previously expected revenues of only $ 43.8 billion. In order to achieve the goal it set itself, Qualcomm would have to grow by an average of eight percent in the following years.


The world’s largest cell phone chip provider expects robust growth in the next few years.

(Photo: Reuters)

Like many other chip manufacturers, Qualcomm has not been able to supply as many semiconductors as customers order for months. The industry is booming like it has not been in a long time. This causes the prices for the components to rise – and with them profits and share prices.

Qualcomm’s papers climbed to a new record high of just under $ 189 last week. This corresponds to an increase of around a fifth since the beginning of the year. According to the analysts, that will not be the case. Bankers expect it to climb further to $ 204 within the next twelve months.

Like Qualcomm, the leading European chip manufacturers Infineon and NXP are confident. Both in the short term and for the next few years. The DAX group Infineon is forecasting a sales increase of 15 percent compared to the previous year and a higher operating margin for the fiscal year that began on October 1.

Over an industry cycle, the Munich-based company wants to increase revenue by an average of nine percent annually. For the current quarter, Infineon expects revenues to increase by 18 percent. “Demand far exceeds supply,” said CEO Reinhard Ploss recently.

The Infineon rally is not over yet

Since the beginning of the year, the price has risen by almost 40 percent to currently a good 43 euros. It is the highest level in two decades. The US bank Goldman Sachs expects the share price to rise to 51 euros within a year. In view of the global decarbonization trend and a solid improvement in profitability, the ratio between opportunities and risks is favorable, according to analyst Alexander Duval. Infineon is also benefiting from the electric car boom. The biggest sellers are power semiconductors, as they are needed to power vehicles.

NXP boss Kurt Sievers promised the shareholders in the middle of the month an annual increase in sales of between eight and twelve percent by 2024. In the past three years, the former Philips division had increased an average of only five percent.

If the plans of the Infineon rival work out, the company from Eindhoven will grow from its current turnover of eleven billion dollars (9.6 billion euros) to 15 billion in three years. “We want to accelerate our profitable growth,” said Sievers.

NXP has long since accelerated on the trading floor: The papers listed in New York are at a record level – and according to analysts, they still have upside potential.

The chip industry association WSTS predicts a worldwide increase in sales of around a quarter for the current year. According to the experts, next year it should go up by a further ten percent.


The American chip manufacturer is growing rapidly and will probably increase sales by almost two thirds this year.

(Photo: Reuters)

The US companies AMD and Nvidia, which have been developing most dynamically in the industry since the beginning of the year, are particularly positive. The head of Intel competitor AMD, Lisa Su, has announced a 39 percent increase in sales for the fourth quarter. If the forecast comes true, the processor specialist’s revenues will increase by almost two thirds in the current year.

Nvidia boss Jensen Huang expects revenues in the current fourth quarter of the fiscal year to be 48 percent higher. He should therefore close the entire financial year in January with an increase of around 60 percent.

When does the chip industry threaten to crash?

The analysts have increased the price target for the California semiconductor manufacturer in the past few days. The recently published quarterly figures convinced the bankers. At around 342 dollars, the papers are at times even well above the 331.5 dollars they expect on Wall Street on average for the next twelve months. The price has already risen more than two and a half times since the beginning of the year. Nvidia is now worth around $ 800 billion on the stock exchange. For comparison: world market leader Intel only has a good 200 billion.

At the moment, no one can say when the huge upswing in the semiconductor industry will end. “We are currently in a super cycle. At some point, however, the downturn will come again, ”warns Peter Fintl, chip expert at the consulting company Capgemini. Because huge investments could lead to overcapacities in a few years. It doesn’t just build Texas Instruments. Samsung also plans to invest 17 billion dollars in a new plant in Texas, as it became known this week.

More: Silicon carbide: Tesla’s chip material of the future comes from Nuremberg.

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