In this article, we will look at the 5 Best High-Bandwidth Memory (HBM4) Value Chain Stocks to Buy According to Hedge Funds. Please visit the 10 Best High-Bandwidth Memory (HBM4) Value Chain Stocks to Buy According to Hedge Funds if you would like to see an extended list and the methodology behind it.
5. Teradyne Inc. (NASDAQ:TER)
Number of Hedge Fund Holders: 80
Teradyne Inc. (NASDAQ:TER), the maker of testing equipment used in HBM manufacturing, announced a collaboration with Tokyo Electron on June 8. This agreement will help the company develop a new testing system for chips used in AI and data centers. Any defective chips will be identified early in the manufacturing process, which will improve quality and reduce wastage. The solution combines Teradyne’s UltraFLEXplus testing technology with Tokyo Electron’s chip inspection system, which will help manufacturers check the quality of chips throughout production. This will ensure only high-quality chips move forward.
Shannon Poulin, President of the Semiconductor Test Group at Teradyne, remarked,
AI device innovation is moving at an unprecedented speed, and our customers need dependable screening at every stage of advanced packaging. TEL’s industry-leading Prexa SDP, combined with Teradyne’s UltraFLEXplus, gives customers a production-ready solution that covers singulated device testing with the thermal precision, power density, and digital performance that today’s AI and data center devices require.
On May 28, UBS reaffirmed its Buy rating on Teradyne Inc. (NASDAQ:TER), along with a price target of $440. The firm’s price target is more bullish than that of Wall Street analysts, who have a median target of $390.
Teradyne Inc. (NASDAQ:TER) designs and manufactures automated test systems and robotics solutions for global semiconductor, industrial, and logistics markets. The company provides critical testing platforms for electronic devices alongside collaborative robotic arms and autonomous mobile robots.
4. Synopsys, Inc. (NASDAQ:SNPS)
Number of Hedge Fund Holders: 84
Synopsys makes the advanced software necessary for designing and testing high-bandwidth memory-heavy AI chips. Analyst sentiment continues to stay positive on the stock. On May 28, Citi raised the firm’s target price on Synopsys Inc. (NASDAQ:SNPS) from $600 to $610 and reiterated a Buy rating on the stock. This reflects 31% upside from current levels. The upward price target revision came after the company announced its Q2 2026 earnings report.
Synopsys Inc. (NASDAQ:SNPS) released its second-quarter earnings on May 27, reporting revenue of $2.28 billion, which comfortably beat the Wall Street consensus of $2.25 billion. The earnings per share came in at $3.35, exceeding the estimate of $3.15 by 6.35%.
For the full year 2026, the company raised its revenue to $9.665 billion at the midpoint. This translates to an EPS of $14.53. AI-driven demand is expected to fuel this growth across design automation and IP segments. Despite these positive results, Synopsys’ stock declined, reflecting mixed investor sentiment.
On a positive note, Synopsys announced improvements to its chip design tools, pre-validated IP, and AI-powered software that work with TSMC’s latest manufacturing technologies. These upgrades will help chipmakers bring next-generation AI and high-performance computing chips to market faster.
Michael Buehler-Garcia, Senior Vice President at Synopsys, highlighted,
TSMC’s most advanced process and packaging technologies are opening new frontiers for performance, bandwidth, and energy efficiency in AI and autonomous systems. Through our deep collaboration, Synopsys is delivering AI-driven design flows, advanced multiphysics signoff, and a comprehensive portfolio of proven interface and foundation IP that help customers accelerate innovation and achieve outstanding quality of results.
Founded in 1986, Synopsys, Inc. (NASDAQ:SNPS) is a provider of design intellectual property (IP) solutions. The company operates through the Design IP and Design Automation. It provides Digital and Custom IC Design solutions, Verification solutions, FPGA design products, and AI-driven EDA solutions.
3. Applied Materials, Inc. (NASDAQ:AMAT)
Number of Hedge Fund Holders: 138
On June 4, Evercore ISI analyst Mark Lipacis reiterated a Buy rating on Applied Materials Inc. (NASDAQ:AMAT) and also assigned a target price of $515 to the stock. In addition to Evercore, two different analysts reaffirmed their Buy ratings on the stock in the first week of June. This includes TD Cowen and Bernstein, with Bernstein having the highest price target on the stock of $525.
Earlier, on May 15, Deutsche Bank increased its price target on Applied Materials, Inc. (NASDAQ:AMAT) from $450 to $550 and maintained a Buy rating. The firm’s revised rice target implies an additional 10% upside from the current levels. The price target revision came after the company delivered strong results and provided a bullish outlook. Deutsche Bank now expects Applied Materials’ semiconductor business to grow by more than 30% year-over-year in 2026. The outlook points to growth ahead of prior expectations.
The positive analyst sentiment followed the company’s Q2 2026 earnings report on May 14. Applied Materials Inc. (NASDAQ:AMAT) reported revenue of $7.91 billion, which was up by 11% year over year. The earnings per share came in at $2.86, which comfortably beat the Wall Street consensus of $2.68.
Applied Materials, Inc. (NASDAQ:AMAT) is a materials engineering solutions company that provides equipment, software, and services to the semiconductor, display, and related industries. The company operates through its Semiconductor Systems and Applied Global Services (AGS) segments.
2. Micron Technology Inc. (NASDAQ:MU)
Number of Hedge Fund Holders: 154
On June 8, C.J. Muse, an analyst at Cantor Fitzgerald, raised the firm’s price target on Micron Technology Inc. (NASDAQ:MU) from $700 to $1500 and maintained an Overweight rating on the stock. The upward price target revision reflects 60% upside from current levels. The firm believes AI has created long-term growth for the memory industry, with demand trends that suggest the current upside has plenty of room to continue. As the only major American manufacturer of memory chips, Micron enjoys a lot of positive analyst sentiment. However, the stock is often quick to react to these analyst expectations, forcing analysts to play catch-up. Consequently, the stock usually trades above the Wall Street median price target.
On the same day as the Cantor Fitzgerald update, Wells Fargo also increased its price target on Micron Technology Inc. (NASDAQ:MU) from $550 to $1220 and reaffirmed an Overweight rating on the stock. As the demand remains strong for memory chips, the supply remains limited, supporting strong pricing. The firm is also encouraged by Micron’s customer agreements.
In general, the stock is enjoying positive sentiment and continued upside. During the first week of June, two more analysts raised their price targets on the stock, including Morgan Stanley and Raymond James. Investors can expect further updates as visibility into future earnings increases.
Micron Technology Inc. (NASDAQ:MU) provides memory and storage solutions sold into client, cloud server, enterprise, graphics, networking, smartphone, mobile-device, automotive, industrial, and consumer markets, among others.
1. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 234
On June 4, Haas Liu of Bank of America Securities reaffirmed a Buy rating on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and assigned a target price of $490 to the stock. This reflects 14% upside from here on. The company’s cutting-edge manufacturing and packaging capabilities continue to be in high demand for GPU, CPU, and memory chip makers.
According to Taiwan Semiconductor Manufacturing Company (NYSE:TSM) CEO C.C. Wei, demand for AI chips remains significantly ahead of supply, adding that the semiconductor industry may need years to fully meet the growing needs of the AI market. He also reiterated that the company expects revenue to grow by more than 30% this year. The CEO also confirmed that the company intends to continue raising prices. However, this will happen in a controlled manner, unlike the pricing surge seen among memory chipmakers. Moreover, robotics and autonomous driving would be the next long-term growth drivers for the company.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a Taiwanese multinational semiconductor contract manufacturing and design company that manufactures, packages, and tests integrated circuits for various industries.
While we acknowledge the potential of TSM to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TSM and that has 100x upside potential, check out our report about the cheapest AI stock.
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