Top 10 Semiconductors Stocks to Watch in 2024

Identifying the right ones can make or break your portfolio’s performance for the year

Fueled by artificial intelligence, the semiconductor industry is drawing even more attention than usual. New money aimed at developing the fastest and most powerful large language models has supercharged investment in processors that power the innovation.

Identifying the right semiconductor stocks can mean the difference between your portfolio’s performance making or breaking for the year. The industry has been a roller-coaster in 2024, with the first half of the year marked by stunning performances for most chip stocks, notably Nvidia (NVDA), which commands the largest market capitalization in the space.

We’ve seen the exuberance fade recently, however, as broader concerns about the economy compound investors’ views about their return on capital. Market volatility has increased and the outlook for the semiconductor industry has quickly shifted out of focus for investors amid the turbulence in the market and the uncertainty in the global economy.

That said, investing more than ever must be strategic. That means taking a closer look at individual names in the space and basing decisions on a more granular view of the industry. Let’s look at some of the top names in the industry.

1. Nvidia

Nvidia (NVDA), the de facto leader of the chip space, offers graphic processing units that lead the industry in processing power for artificial intelligence. Its position is reflected by its stellar gains this year. Investors must ask: Is it too late to get in?

• YTD Performance: +107%

• P/E Ratio: 49.6

• Market Cap: $2.6 trillion

2. Taiwan Semiconductor Manufacturing

Taiwan Semiconductor Manufacturing (TSM), the world’s largest semiconductor foundry business, serves clients like Apple (AAPL), Qualcomm QCOM) and Nvidia. TSM remains on the cutting edge of semiconductor manufacturing.

• YTD Performance: +51.8%

• P/E Ratio: 29

• Market Cap: $770 billion

3. Broadcom

Broadcom (AVGO) focuses on wireless communication chips, enterprise storage, and industrial semiconductor markets. The company has seen robust growth amid the AI boom, benefiting directly and indirectly.

• YTD Performance: +24%

• P/E Ratio: 121.4

• Market Cap: $650 billion

4. ASML Holdings

ASML provides photolithography equipment that’s vital in the production of semiconductor chips, particularly more advanced chips. Its clients include Intel and Micron.

• YTD Performance: +0.2%

• P/E Ratio: 40.4

• Market Cap: $301 billion

5. Advanced Micro Devices

A leader in both consumer and data-center focused chips, Advanced Micro Devices (AMD0 is viewed as one the main competitors to Nvidia—the industry leader. The company continues to make significant inroads in the AI race. This year’s sell-off is seen as a buying opportunity for those who believe in the long-term view.

• YTD Performance: -8.9%

• P/E Ratio: 167

• Market Cap: $223 billion

6. Qualcomm

Qualcomm (QCOM), a leader in wireless technology, controls the footprint in the segment for wireless chips with its Snapdragon chips. The rollout of 5G around the globe is expected to support its business for years to come.

• YTD Performance: +10.9%

• P/E Ratio: 21

• Market Cap: $180 billion

7. Arm Holdings

Arm Holdings (ARM) has been an investor favorite in 2024, rising over 50% since the start of the year. Its applications are tailored for power efficiency and performance—favoring their designs for AI applications. Investors expect ARM to make serious progress in the data center world.

• YTD Performance: +56%

• P/E Ratio: 321

• Market Cap: $131 billion

8. Micron Technology

As a provider memory solutions, Micron (MU), ranks among industry leaders in DRAM and NAND flash memory. Memory is a critical component in AI systems, and the low valuation for the company may attract investors looking for a value play.

• YTD Performance: +1.4%

• P/E Ratio: -16

• Market Cap: $96 billion

9. Intel

A well-known name in the chip space, Intel (INTC) has disappointed investors this year, dropping over 60% from the start of the year. The company is undergoing a restructuring, which has prevented it from capitalizing on the AI boom. Will it catch up?

• YTD Performance: -62%

• P/E Ratio: 83.7

• Market Cap: $82 billion

10. Texas Instruments

Texas Instruments (TXN) focuses its core business on analog products, such as converters, power management chips and amplifiers. Those are used in a variety of industry from the automotive to the industrial industries. It indirectly benefits from the AI boom, and investors who like strong balance sheets may prefer an investment here.

• YTD Performance: +18.3%

• P/E Ratio: 35

• Market Cap: $184 billion

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

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