Most of 2022 has proven to be a tough year for semiconductor stocks in the US and Australia. We wrote a weekly Essay back on 19 August 2022, entitled: Semiconductor Chips – How to Easily Get Exposure on the ASX. Here we find ourselves in November 2022, and semiconductor stocks are starting to break out in price. Why has sentiment changed and why are key semiconductor stocks starting to rally?
One of the key reasons has been the change in market commentary, the talk of tapering interest rate hikes, which in turn, has quelled fears of a recession and stoked some optimism. This has been further helped by the news that Warren Buffett bought 5 billion USD of Taiwan Semiconductor Manufacturing (TSM ticker code in the US).
Analysts have a range of opinions on the outlook for semiconductor stocks. Who to believe? As a subscriber to VectorVest, you have the tools to make your own informed and unemotional decision.
Let’s use VectorVest to look at Australian semiconductor stocks. Click on the Viewers tab and then select Industry Viewer (on the left). From there, identify the industry named InfoTech (Semiconductors&Equip). As of 29 November 2022, it is 13th from the bottom. Right click on the industry group and then select: View Stocks in Industry Group. There are a total of 6 semiconductor stocks in this industry group as of 29 November 2022. SLX.AX stands out having doubled in price since the start of the year (4 January) through to 29 November 2022.
Now let’s use VectorVest to look at US semiconductor stocks. Open up VectorVest US – as a subscriber to VectorVest, you get access to all 5 countries. Repeat the exercise above. However, note, the industry name in the US market is Electronic (Semicndtr Eqp) and Electronic (Semicndtr Mfg). You may wish to sort the industry list by alphabetic order (by clicking on the industry heading at the top to find the industries more easily). Once you have selected each industry, right click to view all the stocks in both the semiconductor industries for the US market. As of 29 November 2022, there are 43 stocks in the Semicndtr Eqp industry and 62 stocks in the Semicndtr Mfg industry.
This is where it gets very interesting…set your date back to 1 November 2022 and QuickTest the top 10 semiconductor stocks per your list in the 2 semiconductor industries (as sorted by VST) to 29 November 2022. Wow! Over the last month, the top 10 semiconductor stocks in each of the 2 semiconductor industries are up over 14%. Is this rally in semiconductor stocks going to continue? Nobody can predict this. If you are selecting semiconductor stocks where the earnings (EPS) are rising, Relative Timing (RT) is rising and, most importantly, the market is rising as per the Color Guard on the Home page of VectorVest and your chosen Market Timing system is up…then you are in a strong position to profit.
Don’t rely on analyst opinions–let VectorVest do the work for you!
Please CLICK HERE to see this week’s video where we take a closer look at the semiconductor stocks in Australia and the US markets.
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