In this article, we will look at the 8 Best Small-Cap Semiconductor Stocks to Buy Right Now.
On June 26, Paul Meeks from Freedom Capital Markets appeared on a Schwab Network interview to discuss the key driving factors for semiconductor stocks, especially after Micron surprised the market with strong earnings. He noted that the interesting point with Micron and other DRAM suppliers is that the demand is so strong that, in comparison, the supply of all the DRAM suppliers combined appears to be scarce. Meeks added that this supply shortage has led to these semiconductor manufacturers signing agreements with all big hyperscalers to lock in prices over the next 3 to 5 years. Meeks believes this to be unprecedented for commodity vendors like Micron and other DRAM players.
He added that despite the strong earnings, memory stocks are expected to go higher even when multiplied by the usual market valuation multiple. The recent contracts with hyperscalers suggest that more than 50% of the revenue for companies like Micron will come from these contracts. This gives visibility for strong earnings growth over at least the next 2 to 3 years.
Meeks believes that we are still in the early investment cycle when it comes to AI buildout. He sees an investment horizon spanning at least 2 to 3 more years. He added that while stocks like Micron have performed well, this does not mean that the whole sector is a buy. Meeks likes DRAM and NAND suppliers particularly.
Now that we have looked at what drove Micron higher, let’s take a look at some smaller semiconductor companies. Here’s our list of the 8 Best Small-Cap Semiconductor Stocks to Buy Right Now.
Our Methodology
To curate the list of 8 Best Small-Cap Semiconductor Stocks to Buy Right Now, we used the Finviz stock screener, WSJ, and Insider Monkey’s hedge fund database. We used the screener to identify small-cap semiconductor stocks and checked the market capitalization from the WSJ. Lastly, we shortlisted the stocks that were most widely held by hedge funds and ranked them in ascending order of this indicator.
Why are we interested in the stocks that hedge funds pile into? 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. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
8 Best Small-Cap Semiconductor Stocks to Buy Right Now
8. POET Technologies Inc. (NASDAQ:POET)
Market Cap: $1.63 billion
Number of Hedge Fund Holders: 14
POET Technologies Inc. (NASDAQ:POET) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. POET Technologies Inc. (NASDAQ:POET) has declined roughly 29% over the past month. The major reason behind the significant price drop has been multiple lawsuits regarding the company’s tax status as well as the cancellation of purchase orders by Marvell associated with Celestial AI.
Earlier in May, the stock was trading close to an all-time high of around $20. The Street expects more than 100% upside for the stock over the next 12-months. In the same month, the company reported a significant advancement by signing a supply agreement with Lumilens to jointly develop a new type of optical interconnect technology called the Electrical-Optical Interposer.
Management noted that the aim of this partnership is to solve a growing bottleneck in AI infrastructure, which is the optical layer that connects GPUs at scale. POET highlighted that the current optical components are expensive and slow to manufacture because they rely on manual, precision assembly. The EOI platform eliminates this by using wafer-level processing, bringing semiconductor-style efficiency to photonics.
Notably, as part of the deal, Lumilens has placed an initial $50 million purchase order with POET, with the potential to grow to over $500 million over five years. POET has also granted Lumilens warrants to purchase shares.
POET Technologies Inc. develops high-speed optical engines, light sources, and photonic integrated circuits designed for artificial intelligence, hyperscale data center, and telecommunications applications. Founded in 1985 and headquartered in Toronto, Ontario, Canada, the company focuses on enabling faster and more energy-efficient optical connectivity solutions for the rapidly expanding AI infrastructure market.
7. Arteris, Inc. (NASDAQ:AIP)
Market Cap: $2 billion
Number of Hedge Fund Holders: 17
Arteris, Inc. (NASDAQ:AIP) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. On June 24, Arteris, Inc. (NASDAQ:AIP) announced that a Chinese automotive chipmaker, SiEngine Technology, licensed the company’s FlexNoC network-on-chip (NoC) interconnect IP for a next-generation automotive SoC platform.
Management noted that the chips will power intelligent cockpit systems, advanced driver assistance, and AI-driven cockpit-drive fusion applications. The company also highlighted that this isn’t a new relationship with SiEngine as the company had used Arteris technology across multiple chip generations. The latest agreement represents a continued expansion of that partnership.
Management highlighted that the need for more sophisticated on-chip connectivity is being driven by increasingly software-defined and compute-heavy automotive architectures. Arteris’ FlexNoC 5 addresses this by improving data routing, reducing congestion, lowering power use, and meeting ISO 26262 automotive safety standards.
Arteris Inc. is a California-based provider of semiconductor system intellectual property solutions. The company also offers professional & licensing services, IP support & maintenance, and on-site support services.
6. indie Semiconductor, Inc. (NASDAQ:INDI)
Market Cap: $805.51 million
Number of Hedge Fund Holders: 17
indie Semiconductor, Inc. (NASDAQ:INDI) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. indie Semiconductor, Inc. (NASDAQ:INDI) has declined roughly 30% over the past month, mainly due to heavy insider selling. Wall Street remains bullish on the stock, with analysts’ 12-month average price target suggesting more than 69% upside from the current level.
Recently, on June 22, the company announced that co-founder Dr. Ichiro Aoki will step down as President and board member on June 29, 2026. Aoki won’t leave the company but will move into a Technical Advisor role, focusing on engineering expertise and supporting the company’s product roadmap. Management noted that co-founder, Dr. Aoki, played a central role in shaping indie’s engineering culture and technical direction since the company’s inception.
Thomas Schiller will be joining indie’s Board of Directors. He has previously served as CFO and EVP of Strategy and has been a Strategic Advisor since November 2024.
Separately, on June 10, indie Semiconductor, Inc. introduced its next-generation edge AI system-on-chip, called the iND881. The system has been designed to power smart cameras in both automotive and robotics applications. Management noted that the chip combines AI processing with indie’s multi-camera image signal processor, offering a compact and efficient solution for intelligent perception systems.
Notably, the system features a heterogeneous compute architecture, pairing a Neural Processing Unit for AI workloads, a Digital Signal Processor for classical signal processing, and a quad-core ARM Cortex-A53 CPU.
indie Semiconductor, Inc. is a semiconductor company focused on developing and supplying automotive semiconductors, photonics, and software platforms.
5. CEVA, Inc. (NASDAQ:CEVA)
Market Cap: $1.18 billion
Number of Hedge Fund Holders: 19
CEVA, Inc. (NASDAQ:CEVA) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. Recently, on June 15, Needham initiated CEVA, Inc. (NASDAQ:CEVA) with a Buy rating and a $55 price target.
The stock has gained roughly 4% over the past month, mainly due to the strong momentum from Q1 2026 earnings. The company witnessed licensing growth during the quarter and also raised the full-year guidance to the top end of its 8% to 12% growth range.
Needham sees CEVA as an attractive play on the emerging Physical AI sector. The firm believes that Physical AI requires a much broader set of semiconductors beyond just compute and memory. The company is well positioned in this sector and holds a 68% global market share in wireless connectivity, alongside strong positions in sensing and DSP/NPU technology.
Needham acknowledges that widespread Physical AI adoption is likely still more than two years away, but remains bullish on the stock, expecting significant upside in the near-term.
CEVA, Inc. delivers silicon and software IP that facilitates smart edge devices to connect, sense, and process data. Established in 1999, the company is based in Rockville, Maryland.
4. Alpha and Omega Semiconductor Limited (NASDAQ:AOSL)
Market Cap: $1.32 billion
Number of Hedge Fund Holders: 20
Alpha and Omega Semiconductor Limited (NASDAQ:AOSL) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. Alpha and Omega Semiconductor Limited (NASDAQ:AOSL) has gained more than 122% year-to-date and more than 17% since the company’s fiscal Q3 2026 earnings release on May 7.
During the quarter, the company posted $163.79 million in revenue, ahead of the expected $160.08 million. The company is accelerating investments in higher-value power management solutions for AI servers and data centers to capture growing content gains in premium segments.
Recently, on June 25, Lake Street initiated coverage of Alpha and Omega Semiconductor Limited with a Buy rating and a $58 price target. The firm noted the company to be an undervalued AI player and argued that despite having a growing presence in AI data centers, the stock trades at a meaningful discount compared to its power semiconductor peers.
As a pure-play power semiconductor company, AOSL is directly exposed to the surging demand for power management solutions in AI infrastructure. Lake Street highlights that the company’s AI data center business is expanding and that overall growth is reaccelerating.
Alpha and Omega Semiconductor Limited is involved in the design, development, and supply of power semiconductor products for computing, communication, consumer electronics, and industrial applications. Its operations are divided into the following geographical segments: Hong Kong, China, South Korea, the United States, and Other Countries.
3. Everspin Technologies, Inc. (NASDAQ:MRAM)
Market Cap: $509.98 million
Number of Hedge Fund Holders: 20
Everspin Technologies, Inc. (NASDAQ:MRAM) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. Everspin Technologies, Inc. (NASDAQ:MRAM) has gained more than 138% over the past 6 months. The gains have been driven by major US defense contracts and the company’s domestic manufacturing partnerships.
The company, earlier in late April, announced securing a $40 million subcontract spanning over 2.5 years with a US prime contractor. As per the contract, Everspin will provide technology and engineering services for the defense industrial base.
More recently, on June 9, Everspin Technologies, Inc. announced that the stock is expected to be added to the US small-cap Russell 2000 Index effective June 27, 2026, as part of the annual Russell index reconstitution. MRAM has officially joined the Russell 2000 index.
Management noted that the inclusion is based on membership in the broader Russell 3000 Index, determined by market capitalization and style attributes. Everspin will also be automatically added to relevant growth and value style indexes. The Russell 2000 is widely tracked by institutional investors and index funds, with approximately $12.2 trillion in assets benchmarked against Russell US indexes. Being added broadens the company’s exposure to this large pool of capital.
Everspin Technologies, Inc. develops and manufactures magnetoresistive random-access memory products for industrial, data center, automotive, aerospace, and other mission-critical applications.
2. Photronics, Inc. (NASDAQ:PLAB)
Market Cap: $1.81 billion
Number of Hedge Fund Holders: 27
Photronics, Inc. (NASDAQ:PLAB) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. Photronics, Inc. (NASDAQ:PLAB) has declined roughly 10% since its fiscal Q2 2026 earnings, in which the company missed EPS and revenue estimates. However, despite the decline, Wall Street continues to anticipate more than 40% upside over the next 12-months.
During fiscal Q2 2026, the company reported revenue of $209.94 million, which fell below the estimates of $216.03 million. The EPS of $0.42 also fell below the $0.53 consensus. The revenue remained flat year-over-year and was led down by the IC business, which declined 5% to $148 million, mainly due to delayed design releases caused by high fab utilization, memory supply constraints, and geopolitical uncertainty. On the bright side, the Flat Panel Display segment revenue grew 13% to $62 million, driven by strong AMOLED demand in China and seasonal recovery in Korea.
Following the earnings release on May 29, Craig-Hallum lowered the price target on Photronics, Inc. from $48 to $42, while maintaining a Buy rating on the shares. The firm noted that the cut reflects near-term headwinds rather than a change in long-term conviction. The firm pointed to second-quarter softness and cautious third-quarter guidance, driven by weak IC demand, memory supply constraints, and geopolitical uncertainty that delayed design releases. However, management noted early signs of a tape-out recovery starting in May.
Photronics Inc. is a leading manufacturer of photomasks, essential components in the semiconductor fabrication process. Photomasks are high-precision quartz plates that contain microscopic images of electronic circuits. The company produces photomasks for various applications, including integrated circuits (ICs), flat panel displays (FPDs), and other advanced technologies.
1. SkyWater Technology, Inc. (NASDAQ:SKYT)
Market Cap: $1.27 billion
Number of Hedge Fund Holders: 33
SkyWater Technology, Inc. (NASDAQ:SKYT) is one of the Best Small-Cap Semiconductor Stocks to Buy Right Now. SkyWater Technology, Inc. (NASDAQ:SKYT) has gained more than 89% over the past 6-months. The gains have been driven by the company’s strong revenue growth in fiscal 2025 and the pending merger with IonQ, expected to be closed in the second or third quarter of 2026.
Last month, on May 8, the company announced that its shareholders approved the company’s merger agreement with IonQ, clearing a key milestone in the acquisition process. Final voting results will be filed with the SEC. Under the terms, SkyWater shareholders will receive $35.00 per share, comprising $15.00 in cash and a stock component tied to IonQ’s trading price within a defined collar range.
According to a bullish thesis on the stock by The Mispricing Desk’s Substack, SKYT still trades at a small discount to the $35 mark. This reflects timing uncertainty around regulatory clearance and short-term volatility in IonQ’s share price, which affects the stock portion of the deal. Analysts view this as a structural and timing risk rather than any fundamental concern about the deal itself.
SkyWater Technology Inc. is a U.S.-based semiconductor foundry specializing in advanced semiconductor development, manufacturing, and packaging services for integrated circuits. The company offers a unique, pure-play technology foundry model through its Technology-as-a-Service (TaaS) approach. SkyWater provides a range of services, including custom semiconductor design, fabrication, and packaging, serving sectors such as aerospace, defense, automotive, and industrial applications.
