Advanced Micro Devices, Inc. (AMD), Intel Corporation (INTC): Is the Semiconductor Industry Still a Buy?

Intel inside

Intel Corporation (NASDAQ:INTC) is a household name and enjoys a far broader market than AMD in the PC segment. It is also a competitor in the tablet and smartphone  SoC market for NVIDIA and is spending heavily on its R&D to have a better position in that segment. Intel will start manufacturing 22 nm mobile chips process node this year, which will give it an edge over other manufacturers.

Intel Corporation (NASDAQ:INTC) will become a key supplier of its Haswell chips starting in the current quarter. It is also supplying its Core i5 chips to the Surface Pro tablet. These products should help the company to improve its declining top line. The company’s revenue from data centers saw a 7% rise to $2.6 billion in the most recent quarter.

Moreover, with the increase in tablets and smartphones, more servers will be required to handle the increased traffic. As Intel Corporation (NASDAQ:INTC) estimates that it has more than 90% of the global server business market share, the surge in smartphones and tablets should add about $2 billion to the company’s revenue.

Final words

The gradual shift from PC to tablets and smartphones places NVIDIA in an advantageous position compared to its two competitors. Intel’s foothold is expected to increase in the mobile market and its extensive brand value and dexterous R&D team will help it deliver. Until then, investors can enjoy its high dividend yield of 4.3%.

AMD’s prospects and possibilities are highly dependent on how the PC industry performs and how it benefits from the gaming console market.

Although I am highly optimistic about NVIDIA and Intel, still I would recommend investors to wait and watch how the market and economy treat these stocks.

The article Is the Semiconductor Industry Still a Buy? originally appeared on Fool.com.

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