In this piece, we will take a look at the five best semiconductor stocks to invest in according to Noam Gottesman’s GLG Partners. If you want more details about the investment firm, its founder and learn about more stocks, then head on over to 10 Best Semiconductor Stocks to Invest In According to Noam Gottesman’s GLG Partners.
5. Cadence Design Systems, Inc. (NASDAQ:CDNS)
GLG’s Stake Value: $193 million
Percentage of GLG’s 13F Portfolio: 0.62%
Number of Hedge Fund Holders: 35
Cadence Design Systems, Inc. (NASDAQ:CDNS) is a software company that deals with the semiconductor sector. Its products are involved in early stage chip manufacturing before the circuits are printed by the fabrication companies onto silicon wafers. Cadence Design Systems, Inc. (NASDAQ:CDNS)’s products allow the companies to verify the designs, create schematics, and analyze the effects of various forces on a chip.
Man GLG had a $193 million stake in Cadence Design Systems, Inc. (NASDAQ:CDNS) by the end of Q4 2021. This came through one million shares, and it represented 0.62% of the firm’s investment portfolio. During the same time period, 35 of the 924 edge funds profiled by Insider Monkey also held shares of the software company.
Cadence Design Systems, Inc. (NASDAQ:CDNS) brought in $773 million in revenue and $0.82 in non-GAAP EPS during its fiscal fourth quarter, beating analyst estimates for both. KeyBanc raised the company’s price target to $445 from $395 in January 2022, highlighting that the electronic design automation (EDA) industry is set for strong growth.
Cadence Design Systems, Inc. (NASDAQ:CDNS)’s largest investor is Panayotis Takis Sparaggis’ Alkeon Capital Management. It owns 4.3 million shares for an $802 million stake.
4. NVIDIA Corporation (NASDAQ:NVDA)
GLG’s Stake Value: $239 million
Percentage of GLG’s 13F Portfolio: 0.77%
Number of Hedge Fund Holders: 111
NVIDIA Corporation (NASDAQ:NVDA) is an American semiconductor design company that develops and sells chips known as graphics processing units (GPUs). Its products are also assembled by third party board manufacturers for the general consumer, and NVIDIA Corporation (NASDAQ:NVDA) is also known for its products targeting the corporate datacenter market.
As its fourth fiscal quarter came to an end, NVIDIA Corporation (NASDAQ:NVDA) had earned $7.6 billion in revenue and $1.32 in non-GAAP EPS, beating analyst estimates for both metrics. The company is developing new products, such as DPUs, as part of its bid to target the rapidly growing data center market and compete with CPU platforms. Investment bank Goldman Sachs resumed coverage of NVIDIA Corporation (NASDAQ:NVDA)’s shares in March 2022, stating that it views the company as an industry leader.
By the end of the fourth quarter of last year, Man GLG had a $239 million stake in NVIDIA Corporation (NASDAQ:NVDA). It owned 814,574 shares of the company, and the stake represented 0.77% of its portfolio. 111 of the 924 hedge funds polled by Insider Monkey during the same time period also owned the company’s shares.
In a third quarter 20221 investor letter, Harding Loevner had the following to say about NVIDIA Corporation (NASDAQ:NVDA):
“The proliferation of devices using chips, whether EVs, “things” in lol, or embedded systems more generally, results in the generation of oceans of data potentially needing to be stored, processed, and analyzed. NVIDIA, the leading chip designer wellknown for its graphic processing units and its complementary CUDA software ecosystem, is at the forefront of the effort to provide the analytical platform needed to unlock the full potential of such specialist processors.”
Ken Fisher’s Fisher Asset Management is NVIDIA Corporation (NASDAQ:NVDA)’s largest investor. It owns a $1.5 billion stake that comes through 5.1 million shares.
3. Texas Instruments Incorporated (NASDAQ:TXN)
GLG’s Stake Value: $280 million
Percentage of GLG’s 13F Portfolio: 0.9%
Number of Hedge Fund Holders: 57
Texas Instruments Incorporated (NASDAQ:TXN) is a semiconductor designer and manufacturer that deals with other companies. Its products are used in gadgets and devices to manage power consumption, regulate and monitor voltage, and measure and convert signals.
Texas Instruments Incorporated (NASDAQ:TXN) reported $4.8 billion revenue and $2.27 GAAP EPS for its fiscal Q4, pleasing Wall Street by exceeding estimates for both. In January 2022, the company announced a new amplifier that is capable of operating at high frequencies to support a large variety of gadgets.
Man GLG’s stake in the company by the end of Q4 2021 equaled $280 million, through owning 1.4 million shares. Insider Monkey’s survey of 924 hedge funds during the same time revealed that 57 had owned a stake in the company.
Texas Instruments Incorporated (NASDAQ:TXN)’s largest investor is Jean-Marie Eveillard’s First Eagle Investment Management which owns 3.3 million shares worth $625 million.
Distillate Capital mentioned the company in its Q3 2021 investor letter. Here is what the fund said:
“The largest exited positions were Oracle, which outperformed significantly, and Texas Instruments and Honeywell, which were roughly flat versus the market in the quarter but were edged out for inclusion by other stocks that became even more attractively valued.”
2. Intel Corporation (NASDAQ:INTC)
GLG’s Stake Value: $290 million
Percentage of GLG’s 13F Portfolio: 0.93%
Number of Hedge Fund Holders: 74
Intel Corporation (NASDAQ:INTC) is one of the oldest semiconductor firms in the world. The company is primarily known for selling central processing units (CPUs) to both the general public and corporate users. Intel Corporation (NASDAQ:INTC) has pioneered countless different processor lineups, iterating its design to improve performance in each generation.
Mr. Gottesman’s former investment firm owned 5.6 million Intel Corporation (NASDAQ:INTC) shares during the fourth quarter of last year. This enabled it to own a $290 million stake constituting 0.93% of its portfolio. At the same time, 74 of the 924 hedge funds polled by Insider Monkey had also owned the company’s shares.
Intel Corporation (NASDAQ:INTC) brought in $19.5 billion in revenue and $1.09 in non-GAAP EPS during its fiscal Q4, enabling it to beat analyst estimates for both. In the wake of the ongoing war in the Eastern European nation of Ukraine, the company became one of the first Western technology firms to halt its sales in Russia, in the wake of U.S. government sanctions.
Intel Corporation (NASDAQ:INTC)’s largest investor is Seth Klarman’s Baupost Group. It owns 18 million shares and has a stake of $928 million.
Third Point Management mentioned Intel Corporation (NASDAQ:INTC) in its fourth quarter 2021 investor letter and stated that:
“2021 was a highly productive year for Intel‘s new CEO, Pat Gelsinger. Despite the stock’s tepid results, we see a compelling, underappreciated fundamental story. Intel’s “brain drain” – a key part of our thesis when we first sought to help the company confront its long-time underperformance – appears to be reversing. Since joining Intel, Mr. Gelsinger has not only brought back prominent Intel former employees but has also attracted talents from competitors such as AMD, Nvidia, Apple, and, most recently, Micron’s stellar Chief Financial Officer, David Zinsner.
We are encouraged by Intel’s aggressive investment plan, including a recently announced fabrication plant in Ohio and acquisition of Tower Semiconductors. We knew from the start that Intel’s turnaround would be complex and lengthy, and we have been pleased to see Mr. Gelsinger sacrifice near-term earnings for long-term growth.
Finally, after a series of blunders across its PC and Server product lines, Intel is finally receiving good reviews for one of its upcoming processors: Alder Lake. Tom’s Hardware, a preeminent hardware publication, called Alder Lake “a cataclysmic shift in Intel’s battle against AMD’s potent Ryzen 5000 chips.” While this is just one product across a broad lineup, and given it will take time to achieve leadership across them all, we are encouraged by these tangible signs of progress under Mr. Gelsinger’s leadership. With talent returning, an improving product suite, and a willingness to invest for growth, we believe Intel’s prospects have turned the corner. We expect that the company’s upcoming analyst day will be an ideal time for Mr. Gelsinger to articulate the progress he has made and begin to reset expectations for the company.”
1. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
GLG’s Stake Value: $499 million
Percentage of GLG’s 13F Portfolio: 1.6%
Number of Hedge Fund Holders: 75
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a contract chip manufacturer based out of Taiwan. The company manufactures chips for other companies, such as the Cupertino, California consumer electronics giant Apple, Inc. (NASDAQ:AAPL) and Advanced Micro Devices, Inc. (NASDAQ:AMD).
The Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) earned $15.7 billion in revenue and $1.15 in GAAP EPS for its fourth fiscal quarter, surpassing Wall Street analyst expectations and beating them for both. The company is currently developing its latest 3-nanometer (nm) chip manufacturing technology, and it expects to start 3nm production later this year, placing it at the forefront of the chip fabrication industry.
GLG had owned 4.1 million Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) shares during Q4 2021, which translated into a $499 million stake representing 1.6% of its portfolio. An Insider Monkey poll during the same time period revealed that 75 out of 924 funds had also owned the company’s shares.
Ken Fisher’s Fisher Asset Management is the Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s largest investor through a $3.1 billion stake by owning 25.9 million shares.
L1 Capital mentioned the Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its third quarter 2021 investor letter, as it outlined that:
“Even though they are not majority State owned and we would expect many of China’s technology champions to continue to grow strongly, outcomes for shareholders may be unsatisfactory… The Fund has retained its investment in Taiwan Semiconductor Manufacturing Company (TSMC) which is well placed to maintain its global leadership in semiconductor manufacturing. Due to geopolitical risks, we limit the position size of TSMC in the Fund.”
Disclosure: None. You can also take a peek at the 10 Dividend Stocks with Over 10% Yield and Cryptocurrencies After Russia-Ukraine War: Top 10 Gainers.
