The 3 Most Undervalued Semiconductor Stocks to Buy in March 2024 (2024)

With patience, undervalued semiconductor stocks could easily race to higher highs.

Just look atNvidia(NASDAQ:NVDA), for example. Since the start of 2023, the tech giant ran from a low of about $150 to a high of $974.Advanced Micro Devices(NASDAQ:AMD) ran from about $110 to $227.

And now — surprise, surprise — they’re pulling back on stretched valuations, and as ridiculous bouts of greed give way to fear. At the same time, I don’t expect the pullbacks to last long at all. With growing, explosive demand for semiconductors, I still believe Nvidia and Advanced Micro could race to higher highs along with some of the less-crowded, undervalued semiconductor names.

We also have to consider that with growing demand, the global semiconductor market could beworth nearly $1.4 trillion from $527.9 billion in 2021, as noted by Fortune Business Insights. Plus, demand isn’t slowing. Instead, industry giants, likeTaiwan Semiconductor(NYSE:TSM) are increasing production as demand grows.

That being said, I’d use weakness as an opportunity for buying the big leaguers as well as some of the most undervalued semiconductor stocks, including:

Aehr Test Systems (AEHR)

One of the most undervalued semiconductor stocks,Aehr Test Systems(NASDAQ:AEHR) is a global provider of test systems for burning-in and testing logic, optical and memory integrated circuits.

For quite some time, AEHR benefited by providing testing equipment and services for the electric vehicle market. And as demand for EVs accelerated, so did AEHR stock. Unfortunately, with slowing EV sales growth, shares plummeted from about $50 to less than $16.22 a share. But don’t count the stock out just yet.

For one, when the Federal Reserve does start to cut interest rates, we could see a resurgence of EV sales. That could benefit AEHR.

Two,according to Bloomberg, the EV market could see about 22% growth this year, noting. “We expect global passenger EV sales — battery-electrics and plug-in hybrids — to increase 21% in 2024 to 16.7 million, with 70% of those being fully electric.”

And last, while the company did reduce guidance earlier this year, “AEHR remains confident about its long-term prospects and about the future demand for its solutions. The company has maintained its long-term growth expectations and sees a huge opportunity ahead of it,”as noted by Seeking Alpha.

Lattice Semiconductor (LSCC)

Next up on this list of undervalued semiconductor stocks isLattice Semiconductor(NASDAQ:LSCC).

For one, Lattice focuses onfield programmable gate arrays, or FPGAs, which are under heavy demand. So much so, that there have been multiple FPGA acquisitions. Among them is AMD’s acquisition of Xilinx back in 2022,as noted by Motley Fool contributors.

Two, while the company has been dealing with oversupply issues, it expects for conditions toimprove in the second half of the year as customer inventories return to normal. Three,CEO James Anderson believes LSCC will remain profitable in coming quarters.

Helping, late last year,Deutsche Bank initiated coverage of LSCC with a buy rating, with a $70 price target. “In the near-term, Lattice is unlikely to stave off cyclical headwinds facing the broader industry, but any downside is likely already priced into shares,” said the firm, as noted by Seeking Alpha.

In addition, LSCC authorized a$250 million share buyback programthrough the end of December 2024. So while LSCC stock recently ran from about $55 to $80, I believe it could retest $98 as it rights the ship.

Direxion Daily Semiconductor Bull 3x Shares (SOXL)

The 3 Most Undervalued Semiconductor Stocks to Buy in March 2024 (3)

Source: Shutterstock

With the latest pullback in semiconductor stocks likely to be short-lived, we can also take advantage of weakness by using an ETF such as theDirexion Daily Semiconductor Bull 3x Shares(NYSEARCA:SOXL). With an expense ratio of 0.94%, SOXL seeks daily investment results of 300% of the performance of the NYSE Semiconductor Index.Some of the index’s top holdings include AMD, Nvidia andBroadcom(NASDAQ:AVGO).

After bottoming out around $15 in early November, the ETF ran to a high of about $57. It’s now trading around $46 with profit-taking in major semiconductor names. But again, I don’t expect the pullback to last long with the artificial intelligence boom fueling demand for semiconductors.

But use extreme caution with triple-levered funds like SOXL. These ETFs are looking for 300% returns on a daily basis.They are constantly rebalancing their portfolios. You need acute precision buying and selling this ETF to make any money. The levered ETFs are designed for day traders. Even Direxion says they are not for everyone. They “should be utilized only by investors who understand leverage risk and who actively manage their investments.” Tread carefully here.

On the date of publication, Ian Cooperdid not have (either directly or indirectly) any positions in the securities mentioned.The opinions expressed in this article are those of the writer, subject to theInvestorPlace.comPublishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

Technology, Semiconductor

Growth Stocks

The 3 Most Undervalued Semiconductor Stocks to Buy in March 2024 (2024)

FAQs

The 3 Most Undervalued Semiconductor Stocks to Buy in March 2024? ›

Nvidia (NVDA 0.69%) has emerged as the dominant force in the AI data center chip industry. As big tech ramps up spending on new artificial intelligence (AI) models, Nvidia's cutting-edge graphics processing units (GPUs) have been critical to their needs for rapid computational power.

What are the best semiconductor stocks to invest in in 2024? ›

The Best Semiconductor Stocks of August 2024
  • Taiwan Semiconductor (TSM) Dividend yield. ...
  • Broadcom (AVGO) Dividend yield. ...
  • Qualcomm (QCOM) Dividend yield. ...
  • Lam Research (LRCX) Dividend yield. ...
  • Analog Devices, Inc. (ADI) ...
  • Microchip Technology (MCHP) Dividend yield. ...
  • United Microelectronics (UMC) Dividend yield. ...
  • ASE Tech Holding Co.
Jul 1, 2024

What is the most undervalued semiconductor stock? ›

4 Undervalued Semiconductor Stocks
  • Infineon Technologies AG ADR. (IFNNY)
  • STMicroelectronics NV ADR. (STM)
  • Skyworks Solutions Inc. (SWKS)
Apr 18, 2024

What are the best chip stocks to buy right now? ›

7 top semiconductor stocks by one-year performance
TickerCompanyPerformance (Year)
NVDANVIDIA Corp130.20%
TSMTaiwan Semiconductor Manufacturing ADR59.53%
AVGOBroadcom Inc59.32%
KLACKLA Corp.45.76%
4 more rows
4 days ago

What is the best penny semiconductor stock? ›

Semiconductor Penny Stocks India
NameClose PricePE Ratio
Havells India Ltd1768.779.7
Honeywell Automation India Ltd54096.6595.39
ABB India Ltd7716.95111.81
CG Power and Industrial Solutions Ltd689.75121.01
7 more rows

What stock will boom in 2024? ›

Best S&P 500 stocks as of August 2024
Company and ticker symbolPerformance in 2024
General Electric (GE)66.9%
Constellation Energy (CEG)62.4%
Targa Resources (TRGP)55.7%
Mohawk Industries (MHK)55.6%
6 more rows

What is the best AI stock to buy? ›

7 best-performing AI stocks
TickerCompanyPerformance (Year)
SOUNSoundHound AI Inc93.93%
PRCTProcept BioRobotics Corp81.36%
AVAVAeroVironment Inc.77.42%
ISRGIntuitive Surgical Inc38.41%
4 more rows
4 days ago

What is the best semiconductor for AI? ›

Nvidia (NVDA 0.69%) has emerged as the dominant force in the AI data center chip industry. As big tech ramps up spending on new artificial intelligence (AI) models, Nvidia's cutting-edge graphics processing units (GPUs) have been critical to their needs for rapid computational power.

What company makes the most advanced microchips? ›

TSMC, or Taiwan Semiconductor Manufacturing Company, is the world's largest and most advanced contract chip manufacturer. TSMC makes semiconductors for companies from Apple to Nvidia .

What is the best blue chip stocks to buy? ›

These are 10 of the best blue-chip stocks to buy today:
  • Brown-Forman Corp. (BF. A, BF.B)
  • Hormel Foods Corp. (HRL)
  • Intel Corp. (INTC)
  • Toronto Dominion Bank (TD)
  • United Parcel Service Inc. (UPS)
  • Hershey Co. (HSY)
  • Johnson & Johnson (JNJ)
  • Realty Income Corp. (O)
Jun 25, 2024

What is the number one semiconductor stock? ›

Key Takeaways
StockImplied Upside*
Nvidia Corp. (ticker: NVDA)27.9%
Advanced Micro Devices Inc. (AMD)39.5%
Taiwan Semiconductor Manufacturing Co. Ltd. (TSM)15.2%
Synopsys Inc. (SNPS)19.7%
3 more rows

What are the top moving penny stocks? ›

Most Active Penny Stocks
  • LAB1.650.23% Standard BioTools Inc.
  • AMRN0.640.02% Amarin Corporation plc.
  • SGMO0.870.17% Sangamo Therapeutics, Inc.
  • VSEE4.251.82% VSee Health, Inc.
  • MKDW3.221.14% MKD Technology Inc.
  • IGPK0.000.00% Integrated Cannabis Solutions, Inc.
  • MLGO1.290.06% MicroAlgo Inc.
  • DPLS0.000.00% DarkPulse, Inc.

What are the top 5 penny stocks to buy? ›

List of Penny Stocks
Company NameLTPMarket Cap (in Cr)
Ganga Forging Ltd₹7.17₹96.65
Diligent Media Corporation Ltd₹6.76₹79.56
Ankit Metal & Power Ltd₹4.52₹63.78
Neueon Towers Ltd₹2.80₹15.83
6 more rows

What is the outlook for the semiconductor market in 2025? ›

Semiconductor manufacturing equipment growth is expected to continue in 2025, with sales forecast to set a new high of $128 billion in 2025, driven by both front-end and back-end segments.

Are semiconductor stocks a good long-term investment? ›

The arms race in artificial intelligence (AI) is creating a favorable demand environment for leading semiconductor companies. The PHLX Semiconductor Sector index has soared 122% since bottoming out in 2022, far outpacing the 69% return of the tech-centric Nasdaq Composite.

What is the future semiconductor market? ›

Growth in global semiconductor sales is predicted to pick up speed in 2025–2026 before levelling off at the 5%–6% annual average seen over the previous ten years. Experts estimate that by 2027, the AI market will be valued at $733.7 billion.

Will on semiconductor stock go up? ›

ON Stock 12 Month Forecast

Based on 18 Wall Street analysts offering 12 month price targets for ON Semiconductor in the last 3 months. The average price target is $78.82 with a high forecast of $103.00 and a low forecast of $25.00. The average price target represents a 12.33% change from the last price of $70.17.

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