5 Best Semiconductor Equipment Stocks to Buy

4. KLA Corporation (NASDAQ:KLAC)

Number of Hedge Fund Holders: 44

KLA Corporation (NASDAQ:KLAC) is trading at a TTM PE ratio of 14.69, as of April 26, and the stock has gained 16.69% over the past 6 months. KLA Corporation (NASDAQ:KLAC) is one of the best semiconductor equipment stocks to buy according to hedge funds.

As of January 27, Wells Fargo analyst Joe Quatrochi has a $455 price target and an Overweight rating on KLA Corporation (NASDAQ:KLAC).

KLA Corporation (NASDAQ:KLAC) was a part of 44 investors’ portfolios at the end of Q4 2022 that held collective positions worth $986.8 million in the company. As of December 31, Alkeon Capital Management is the top shareholder and has a position worth $264 million.

Aristotle Atlantic Partners, LLC, made the following comment about KLA Corporation (NASDAQ:KLAC) in its Q4 2022 investor letter:

“KLA Corporation (NASDAQ:KLAC) is a supplier of process control equipment and data analytics products for a broad range of industries, including semiconductors, printed circuit boards (PCB) and displays. It provides solutions for manufacturing and testing wafers and reticles, integrated circuits (IC or chip), packaging, light-emitting diodes (LED), power devices, compound semiconductor devices, microelectromechanical systems (MEMS), data storage, PCBs, flat and flexible panel displays, and general materials research, as well as providing contracted and comprehensive installation and maintenance services across its installed base. Customers in international markets account for about 90% of the company’s revenue.

We see a unique opportunity in KLA to benefit from the increasing complexity of semiconductor wafer manufacturing through its leading position in process technology and wafer inspection. We believe Wafer Fab Equipment (WFE) spending will continue to rise over the next decade, as semiconductor capital intensity remains elevated and as semiconductors continue to account for a larger share of the global economy due to the above average growth of IoT devices, auto electrification, data center and cloud computing, and mobile communication/computing. We see the stock as an attractive investment opportunity, as investor expectations for 2023 have been reset at lower levels following WFE capital expenditures (CapEx) cuts by foundries and semiconductor companies.”