Top 3 buy-rated semiconductor stocks in Q4 2021

By: Motiur Rahman
Motiur Rahman
Md Motiur is a Financial Analyst at Invezz covering the North American, European and Asian stock markets. He has… read more.
on Oct 12, 2021
  • The international devices corporation forecasts the semiconductor industry to reach $600 billion by 2025.
  • The industry experienced a significant slowdown in the previous eighteen months due to covid-19.
  • However, with a rebound on course, some stocks could experience significant gains in the coming months.

The semiconductor industry is poised for a significant rebound with several stocks recovering from declines experienced this year. And with some of the stocks carrying consensus buy ratings from Street analysts, it could be time to invest ahead of the rebound. Here are three stocks that could yield significant returns in the coming months.

Micron Technology (MU)

Micron Technology Inc. (NASDAQ:MU) shares are down nearly 30% since peaking in April, pushing the stock to a cheap P/E ratio of 13.16. Moreover, its forward P/E of 7.72 indicates significant earnings growth expectations over the next 12 months.

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Street analysts expect MU’s EPS to grow by about 50% next year and at an average annual rate of nearly 22% over the next five years.

Source – TradingView

Technically, MU shares appear to be trading within a descending channel formation in the intraday chart, pushing the stock closer to oversold conditions. 

Therefore, investors could target rebounds at about $72.22, or higher at $75.71. On the other hand, $65.54 and $62.19 are crucial support zones.

ASE Technology

ASE TechnologyHoldings Co. Ltd (TAI:3711) is another semiconductor stock rated buy by Street analysts. The stock is down more than 30% since 5th August, pushing the P/E ratio down to 11.50. In addition, its forward P/E of 8.82, indicates significant earnings growth expectations for the next 12 months.

Analysts expect ASE EPS to grow by 62.80% this year, before rising at an average annual rate of 34.20% over the next five years.

Source – TradingView

Technically, ASE Technology stock seems to have recently plunged into oversold conditions after trading within a descending trend over the past seven weeks.

Therefore, investors could target potential rebound profits at about $7.67, or higher at $8.62. On the other hand, if the decline continues, the stock could find support at $5.78, or lower at $4.90.

Amkor Technology

Amkor Technology Inc. (NASDAQ:AMKR) shares plunged more than 7% on Tuesday to extend the current 3-week declines to over 20%. Credit Suisse analysts lowered Amkor rating to neutral from outperform, with a price target of $27.00.

As a result, AMKR shares now trade at an attractive P/E ratio of 12.20, making the stock a compelling option for value investors. Moreover, analysts expect its EPS to grow by 177% this year and at an average annual rate of 24.50% over the next five years.

Source – TradingView

Technically, Amkor shares seem to have plummeted closer to oversold conditions following Tuesday’s plunge, creating an opportunity for a rebound.

As a result, investors could target profits at about $25.00, or higher at $27.00 while $21.29 and $19.35 are crucial support levels.

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