On January 6, CNBC reported that semiconductor stocks started the year strongly, driven primarily by rising demand from AI. The rally was led by South Korea’s SK Hynix Inc. (KRX:000660) and Samsung Electronics Co., Ltd. (KRX:005930), two of the world’s biggest memory makers. The companies gained 11.5% and 15.9% respectively, year-to-date as of January 6.
Memory is a core component in the chips used to train and operate AI models. As major tech companies continue to invest billions of dollars in AI chips and data centers, demand for memory is increasing. This has led to a supply shortage.
One critical component, known as dynamic random-access memory or DRAM, which is used in AI data centers, experienced a significant price increase in 2025. According to Counterpoint Research, memory prices are forecasted to increase by another 40% through the second quarter of 2026.
Ben Barringer, head of technology research at Quilter Cheviot, told CNBC that the recent gains across semiconductor stocks have been mainly driven by “the memory side of the market rather than logic chips.” He said:
“We’re seeing a combination of very strong demand from AI workloads and relatively constrained supply, particularly in high-bandwidth memory, which is essential for training and running large AI models.”
With this context in mind, let’s now take a look at the 6 best semiconductor penny stocks to buy now.
Our Methodology
To compile our list of the 6 best semiconductor penny stocks to buy now, we used the Finviz stock screener to look for semiconductor stocks with a share price of under $5 as of January 15, 2026. Next, we focused on the top 6 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q3 2025 database of 978 elite hedge funds. Finally, the 6 best semiconductor penny stocks to buy were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q3 2025.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
6 Best Semiconductor Penny Stocks to Buy Now
6. Peraso Inc. (NASDAQ:PRSO)
Share Price: $1.00
Number of Hedge Fund Holders: 2
Peraso Inc. (NASDAQ:PRSO) is one of the best semiconductor penny stocks to buy now. On December 5, Benchmark reiterated a Speculative Buy rating on Peraso Inc. (NASDAQ:PRSO) with a $3 price target. The firm pointed to stronger adoption trends across multiple markets as a key factor for its positive outlook.
Benchmark highlighted that Peraso Inc.’s (NASDAQ:PRSO) pre-production products rose to a record 12, up from 7 in the previous quarter. This increase shows a growing commercial pipeline. The firm also noted that the company has secured an order from a major global Fixed Wireless Access (FWA) equipment provider that serves key service operators.
The research firm also pointed out that growing interest in 6 GHz technology is creating new opportunities for Peraso Inc. (NASDAQ:PRSO). Additionally, recently completed field trials for next-generation tactical communications have led to increased engagement from defense customers. The company is also seeing activity in related markets Edge AI, last-mile delivery, drones, and autonomous vehicles.
In other news, on December 23, Peraso Inc. (NASDAQ:PRSO) announced that it is appointing Cees Links, a veteran wireless entrepreneur and technology executive, to its board of directors.
Peraso Inc. (NASDAQ:PRSO) specializes in high-performance 60 GHz unlicensed and 5G mmWave wireless technology. The company provides chipsets, modules, software, and IP to support various applications such as fixed wireless access, military, immersive video, and factory automation.
5. SmartKem, Inc. (NASDAQ:SMTK)
Share Price: $1.10
Number of Hedge Fund Holders: 2
SmartKem, Inc. (NASDAQ:SMTK) is one of the best semiconductor penny stocks to buy now. On January 6, SmartKem, Inc. (NASDAQ:SMTK) reported that it entered into a 12-month paid proof-of-concept agreement with a global consumer electronics company. The partnership will focus on developing next-generation smart wearable devices that use a conformable MicroLED display powered by SmartKem, Inc.’s (NASDAQ:SMTK) proprietary organic thin-film transistor (OTFT) technology.
The partnership aims to build curved surface wearable devices using OTFT-based MicroLED display technology to address key challenges in the wearables market, including extreme miniaturization, low power consumption, outdoor visibility, and high resistance to impact. This project will combine SmartKem, Inc.’s (NASDAQ:SMTK) proprietary OTFT technology with MicroLEDs using a “chip-first” design to target one of the smallest and most demanding form factors in consumer electronics.
Previously, on December 10, SmartKem, Inc. (NASDAQ:SMTK) shared that it has developed the world’s first all-organic-transistor (AOT) biometric sensor. This technology, which was developed in collaboration with the SJTU, significantly enhances the sensitivity of optical detection for flexible biometric use cases, such as finger or palm print recognition on curved surfaces.
According to the report by SmartKem, Inc. (NASDAQ:SMTK), this new technology also has the potential to address challenges like fingerprint spoofing through advanced liveness detection methods that can catch subtle signals that tell apart real fingerprints from fake ones.
SmartKem, Inc. (NASDAQ:SMTK) is a semiconductor company that focuses on the development of a new class of transistor using its proprietary advanced semiconductor materials.
