12 Best Semiconductor Stocks To Buy Now

Published December 16, 2022 at 8:30 am EST Updated August 31, 2026 at 8:41 pm EDT

In this article, we will discuss the 12 Best Semiconductor Stocks To Buy Now.

Whether it’s the remote of your television or your cellphone, semiconductors are an integral part of the devices around us and are more ubiquitous than you might think. The demand for semiconductors will keep rising as long as advancements and innovations are made in technology. In 2021, global semiconductors sales stood at $555.89 billion, up 26.2% YoY. Some of the leading semiconductor companies include Samsung Electronics, Intel Corporation (NASDAQ:INTC), and Advanced Micro Devices, Inc. (NASDAQ:AMD).

The semiconductor industry has also been affected by the outbreak of COVID-19. The shift to work from home generated demand for more tech devices, and the semiconductor industry struggled to keep up with the demand for chips worldwide. However, as the central banks have started monetary tightening, causing a slowdown in the global economy, the demand for discretionary tech products has reduced, causing a decline in sales for semiconductor companies. In 2023, the total sales of the global semiconductor industry are forecasted to be at $596 billion, a 3.6% decline YoY.

In the coming years, the applications expected to drive the global semiconductor industry include electric vehicles and smartphones. In 2020, the smartphone semiconductor market size stood at $116 billion and is forecasted to reach $162 billion by 2030. The global market size for battery electric vehicles in 2020 stood at $47 billion and is forecasted to reach $212 billion by 2030, growing at a CAGR of 14.1% during the period.

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Our Methodology

We picked some of the notable semiconductor stocks that have a low PE ratio and high popularity among hedge funds. PE ratio is an effective metric to judge the attractiveness of a stock’s price. A lower P/E ratio is preferred by investors as it means that the stock is trading at a cheaper price as compared with its peers. We gauged the hedge fund sentiment from Insider Monkey’s database of 920 elite hedge funds.

12. Advanced Micro Devices, Inc. (NASDAQ:AMD)

Forward P/E ratio as of December 15: 18.02

Number of Hedge Fund Holders: 89

Advanced Micro Devices, Inc. designs microprocessors for computers and consumer electronics products. The majority of its revenue is generated from PCs and data center markets through the sale of CPUs and GPUs. Advanced Micro Devices, Inc. supplies chips for gaming consoles such as the Sony PlayStations and Microsoft Xbox. In 2022, it acquired Xilinx to diversify its business and increase opportunities in crucial end markets, including the data center.

On November 15, 2022, Chris Caso, an analyst at Credit Suisse, started covering Advanced Micro Devices, Inc. with a price target of $90 and an Outperform rating on the stock. The analyst expects further growth in server share gains and the cloud market in the future.

As per Insider Monkey’s database, 89 hedge funds remained bullish on Advanced Micro Devices, Inc. at the end of Q3 2022. Fisher Asset Management came out to be the biggest holder of the company’s shares at the end of the quarter.

In addition to Advanced Micro Devices, Inc., Skyworks Solutions, Inc. (NASDAQ:SWKS), United Microelectronics Corporation (NYSE:UMC), and ASE Technology Holding Co., Ltd. (NYSE:ASX) are included in our list of 12 best semiconductor stocks to buy now.

11. ON Semiconductor Corporation (NASDAQ:ON)

Forward P/E ratio as of December 15: 14.93

Number of Hedge Fund Holders: 45

ON Semiconductor Corporation (NASDAQ:ON) makes semiconductors for automotive and industrial markets. The firm is the largest supplier of image sensors to the automotive market and the second-largest power chipmaker in the world. The company is shifting its focus to emerging applications such as electric vehicles, industrial automation, autonomous vehicles, and renewable energy.

On November 1, 2022, Joseph Moore, an analyst at Morgan Stanley, increased his price target on ON Semiconductor Corporation to $70.40 while keeping an Equal Weight rating on the stock. According to the analyst, the Q3 results were satisfying, but the margins are being weighed down by startup costs for silicon carbide.

As per Insider Monkey’s database, 45 hedge funds had stakes in ON Semiconductor Corporation at the end of the third quarter. Whale Rock Capital Management remained the leading stakeholder in the company at the end of Q3 2022.

10. Intel Corporation (NASDAQ:INTC)

Forward P/E ratio as of December 15: 15.04

Number of Hedge Fund Holders: 69

Intel Corporation designs and manufactures microprocessors for personal computers worldwide. Intel Corporation was the first to develop the x86 design for microprocessors. Intel Corporation has acquired Altera Corporation, Mobileye Global Inc., and Habana Labs Ltd. to improve its standing in the non-PC sector. Intel Corporation provides a forward dividend yield of 5.17% at the current price level.

On October 28, 2022, Blayne Curtis, an analyst at Barclays, upgraded his rating on Intel Corporation to Equal Weight with a price target of $30. According to the analyst, the bottom is close for the stock with the company’s cost-cutting measures helping in preserving the book value of the stock.

69 hedge funds are currently bullish on Intel Corporation as per Insider Monkey’s database. Two Sigma Advisors had the leading stake in the company at the end of Q3 2022.

Baron Funds mentioned the company in its Q2 2022 investor letter and stated that:

Then, there is the case of Intel Corporation (NASDAQ:INTC). A blue-chip tech champion with a market capitalization of over $500 billion in early 2000, the stock was trading at a P/E multiple of 42. It was a fast-growing company whose stock price and multiple declined more or less in line with its peers. However, unlike Google, Intel’s net income has grown from $7.3 billion in 1999 to $19.9 billion in 2021, a compounded annual growth rate of just 4.7%. Its growth from the dot com era has not proven to be durable, and Intel has yet to trade at the price it attained in 1999.

9. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)

Forward P/E ratio as of December 15: 13.57

Number of Hedge Fund Holders: 87

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the largest dedicated chip foundry in the world as of 2021. The company’s illustrious customer base includes Apple Inc. (NASDAQ:AAPL), Advanced Micro Devices, Inc., and NVIDIA Corporation (NASDAQ:NVDA).

On November 18, 2022, Hans Engel, an analyst at Erste Group, upgraded his rating on Taiwan Semiconductor Manufacturing Company Limited to Buy, citing the increased diversification resulting from the company’s first fab facility in the United States.

At the end of Q3 2022, 87 hedge funds in Insider Monkey’s database were long on Taiwan Semiconductor Manufacturing Company Limited at the end of the quarter. Berkshire Hathaway remained the leading stakeholder of the company at the end of Q3 2022.

Baron Funds mentioned the company in its Q2 2022 investor letter. Here is what the fund said:

Semiconductor giant Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)detracted in the second quarter due to macroeconomic uncertainties and softening demand for consumer electronics. We retain conviction that Taiwan Semi’s technological leadership, pricing power, and exposure to secular growth markets, including high-performance computing, automotive, and IoT, will allow the company to deliver strong revenue growth over the next several years.

8. Broadcom Inc. (NASDAQ:AVGO)

Forward P/E ratio as of December 15: 13.44

Number of Hedge Fund Holders: 74

Broadcom Inc. (NASDAQ:AVGO) focuses on radio frequency filters and amplifiers used in high-end smartphones. To expand its software offerings, the corporation has bought Brocade Communications Systems, CA Technologies, and is currently in the process of acquiring VMware. Broadcom Inc. is also a healthy dividend-paying company providing a current dividend yield (fwd) of 3.20%

On December 12, 2022, Vivek Arya, an analyst at BofA, increased his price target on Broadcom Inc. to $650 while keeping a Buy rating on the stock. The analyst believes that the company is attractive at the current price level on a pure valuation basis with its strong cash flow and pricing power.

According to Insider Monkey’s database, 74 hedge funds had stakes in Broadcom Inc. at the end of the September quarter. Fisher Asset Management remained the leading stakeholder of the company at the end of the third quarter.

7. Microchip Technology Incorporated (NASDAQ:MCHP)

Forward P/E ratio as of December 15: 13.09

Number of Hedge Fund Holders: 45

Microchip Technology Incorporated (NASDAQ:MCHP) is an American corporation that manufactures microcontrollers, mixed-signal, analog, and Flash-IP integrated circuits. The majority of the company’s revenue is generated through its MCUs, used in a variety of products such as remote controls and garage door openers.

On November 4, 2022, Timothy Arcuri, an analyst at UBS, reduced his price target on Microchip Technology Incorporated to $90 while keeping a Buy rating on the stock. According to the analyst, the company’s Q3 result and forward guidance for Q4 were both solid, however, the concern over order cancellations is prompting him to reduce the target price on the stock.

As per Insider Monkey’s database, 45 hedge funds remained bullish on Microchip Technology Incorporated at the end of the third quarter. Platinum Asset Management had the biggest stake in the company at the end of the third quarter.

6. NXP Semiconductors N.V. (NASDAQ:NXPI)

Forward P/E ratio as of December 15: 12.82

Number of Hedge Fund Holders: 52

NXP Semiconductors N.V. (NASDAQ:NXPI) is among the leading suppliers of high-performance mixed-signal products. NXP Semiconductors N.V. provides microcontrollers and analog chips for automotive clusters, infotainment systems, powertrains, and radars.

On November 2, 2022, Ross Seymore, an analyst at Deutsche Bank, reduced his price target on NXP Semiconductors N.V. to $170 while keeping a Buy rating on the stock. According to the analyst, although the company’s Q3 results were remarkable, the company is taking a cautious approach in Q4 to tackle the declining demand in its consumer segments.

As per Insider Monkey’s database, 52 hedge funds owned stakes in NXP Semiconductors N.V. at the end of the third quarter. Citadel Investment Group remained the leading stakeholder of the company at the end of Q3 2022.

5. QUALCOMM Incorporated (NASDAQ:QCOM)

Forward P/E ratio as of December 15: 12.15

Number of Hedge Fund Holders: 80

QUALCOMM Incorporated (NASDAQ:QCOM) develops and licenses wireless technologies and chips for smartphones. The primary technologies covered by the company’s patents are CDMA and OFDMA, which are wireless communications protocols that form the basis of all 3G and 4G networks.

On November 15, 2022, Chris Caso, an analyst at Credit Suisse, started covering QUALCOMM Incorporated with a price target of $150 and an Outperform rating on the stock. As per the analyst, QUALCOMM Incorporated is well-positioned going ahead as compared with other chipmakers.

According to Insider Monkey’s database, 80 hedge funds held shares of the company at the end of the third quarter of 2022. Matrix Capital Management was the most bullish fund on the company’s stock at the end of Q3 2022.

Here is what ClearBridge Investments Large Cap Value Strategy has to say about QUALCOMM Incorporated in its Q4 2021 investor letter:

Market strength continued in the fourth quarter, with only the communication services sector down in the Russell 1000 Value Index. Portfolio returns benefited from the strong performance of semiconductor maker Qualcomm, which has executed exceptionally well in pursuing the transition to 5G, growing both content and share due to its leadership position in cellular technology. The chipmaker recently outlined a number of peripheral growth opportunities outside of mobile markets, including automotive (where it hopes to leverage its strong presence in the automotive infotainment space into advanced driver assistance systems), Internet of Things (including opportunities in the PC market, VR/AR market, and factory automation) and radio frequency (where mmWave adoption globally, including China, would drive substantial upside).

4. STMicroelectronics N.V. (NYSE:STM)

Forward P/E ratio as of December 15: 9.78

Number of Hedge Fund Holders: 19

STMicroelectronics N.V. (NYSE:STM) is a leading firm in the semiconductor space, and its products include analog chips, microcontrollers, discrete power semiconductors, and sensors. The company is also among the well-known chip suppliers to the automotive and industrial sectors.

On December 12, 2022, Christopher Rolland, an analyst at Susquehanna, started covering STMicroelectronics N.V. with a price target of $50 and a Positive rating on the stock. The company’s Q3 2022 revenue was reported at $4.31 billion, beating market expectations by $69.31 million. The Normalized EPS of the company stood at $1.16, beating analysts’ estimates by $0.12 in the third quarter.

As per Insider Monkey’s proprietary database, 19 hedge funds were bullish on STMicroelectronics N.V., as of the end of the third quarter. Millennium Management was the biggest stakeholder in the company’s stock at the end of Q3 2022.

Here is what Saturna Capital has to say about STMicroelectronics N.V. in its Q3 2021 investor letter:

STMicroelectronics has a goal of becoming carbon neutral by 2027, and in 2020 reported that their greenhouse gas emissions were down 19% over the previous year. In 2020, STMicroelectronics was the only semiconductor company with targets approved by the Science Based Targets Initiative for limiting warming to 1.5 degrees Celsius, and their 2027 net-zero goal is recognized as one of the most ambitious in the industry. As greenwashing presents a growing concern within the ESG community, and as more and more funds engage in re-branding exercises that have little to do with pursuing sustainable investment practices among others, our definition of sustainability includes financial sustainability, most often demonstrated by intelligent capital allocation leading to solid cash flows that can sustain a business without resorting to excessive leverage.

3. Skyworks Solutions, Inc. (NASDAQ:SWKS)

Forward P/E ratio as of December 15: 9.14

Number of Hedge Fund Holders: 39

Skyworks Solutions, Inc. is a chipmaker with its main products being power amplifiers, switches, filters, and integrated front-end modules that support wireless transmissions. Skyworks Solutions, Inc.’s biggest clients include smartphone manufacturers, although the company is also growing in the non-handset markets as well.

On November 15, 2022, Chris Caso, an analyst at Credit Suisse, initiated coverage of Skyworks Solutions, Inc. with a price target of $125 and an Outperform rating on the stock. The analyst believes that we are close to the bottom of the down cycle, and there is potential for growth from the current price level.

According to Insider Monkey’s database, 39 hedge funds held stakes in Skyworks Solutions, Inc. at the end of the third quarter ending September 2022. Millennium Management remained the leading stakeholder in the company at the end of Q3 2022.

Heartland Advisors, which owns 119,628 shares of Skyworks Solutions, Inc. as of June 30, discussed how cheap the stock has become in its Q3 2022 investor letter:

Before the risk-on rebound early in the quarter, we were searching for opportunities to shift from our defensive stance, looking for beaten-down, high-quality “early cycle” leaders. Existing holding, Skyworks Solutions, Inc., represents one such opportunity that was added to on weakness.

Skyworks is one of two leading providers of radio frequency system components to smartphone makers and electronics manufacturers. With every step-up in product complexity, over the past two decades, the competitive landscape has shrunk while gross margins have increased significantly. 5G represents another such step-up, which is likely to increase how much Skyworks can make per smartphone.

Apple is a big customer, accounting for more than half of Skyworks’ sales. That customer concentration has depressed Skyworks’ valuation over time. More recently, fears surrounding a global recession and risk to consumer demand have further pressured valuation. However, the handset business is expected to benefit from 5G content, which may help offset some macroeconomic pressures. Away from the handset business, Skyworks’ growth is expected to accelerate thanks to other secular drivers such as WIFI 6 and growth of the industrial internet (i.e., “Internet of Things”).

At a P/E of less than eight and a 2.3% dividend yield, SWKS rarely gets this cheap, making this high-quality stock compelling for longterm investors.

2. United Microelectronics Corporation (NYSE:UMC)

Forward P/E ratio as of December 15: 8.98

Number of Hedge Fund Holders: 17

United Microelectronics Corporation was founded in 1980 and is the third-largest chip foundry globally, with a 7% market share in 2021. The company runs 12 fabs in Taiwan, Japan, Singapore, and Mainland China, with additional sales offices in the United States, Europe, and South Korea.

On September 14, 2022, Rick Hsu, an analyst at Daiwa, increased his price target on United Microelectronics Corporation to NT$46 from NT$43. The analyst believes that the company’s structural profitability should increase even after accounting for price erosion in light of the present inventory correction.

As per Insider Monkey’s database, 17 hedge funds had stakes in United Microelectronics Corporation at the end of the third quarter. Arrowstreet Capital remained the leading stakeholder in the company at the end of Q3 2022.

1. ASE Technology Holding Co., Ltd. (NYSE:ASX)

Forward P/E ratio as of December 15: 8.45

Number of Hedge Fund Holders: 10

Headquartered in Kaohsiung, Taiwan, ASE Technology Holding Co., Ltd. provides semiconductor assembling and test manufacturing services. The company’s operations are divided into Packaging, Testing, and Electronic Manufacturing Services, out of which packaging is the most revenue-generating segment. Almost half of the company’s total revenue comes from sales in the United States.

On October 28, 2022, ASE Technology Holding Co., Ltd. reported results for Q3 2022, reporting revenue of $5.88 billion, up 8.5% YoY. The company’s Normalized EPS of $0.26, beat the market estimates by $0.02. ASE Technology Holding Co., Ltd. is a strong dividend-paying company providing a current dividend yield (ttm) of 11.60%.

10 hedge funds were long on the company’s stock at the end of the third quarter, according to Insider Monkey’s database. Fisher Asset Management had the biggest long position in the company at the end of Q3 2022.

You can also take a look at 10 Best December Dividend Stocks To Buy and 15 Most Trusted Companies in the World.

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