Semiconductor Stocks: These Are Top Picks For 2021, Wall Street Analysts Say

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With 2020 ending, Wall Street analysts are making their picks for the best semiconductor stocks to buy and watch in 2021.


Investment banks Evercore ISI, KeyBanc Capital Markets and UBS made their picks earlier this month. On Monday, Mizuho Securities and Rosenblatt Securities revealed their top picks for semiconductor stocks in the year ahead.

“We are bullish on the semiconductor space into first-half 2021, with strong year-over-year momentum and tailwinds from a supportive fundamental and macroeconomic backdrop as well as the first year of a presidency,” Mizuho analyst Vijay Rakesh said in a note to clients.

He sees a continued rebound in the global automotive, industrial and handset segments. Plus, the overall economic picture should brighten as the world emerges from the Covid-19 pandemic, Rakesh said.

Mizuho Names Nine Semiconductor Stocks As Top Picks

His top picks for 2021 in semiconductor stocks include Allegro MicroSystems (ALGM), Advanced Micro Devices (AMD), Broadcom (AVGO), Micron Technology (MU), Nvidia (NVDA), NXP Semiconductors (NXPI), ON Semiconductor (ON), Qualcomm (QCOM), and Skyworks Solutions (SWKS).

Allegro, NXP and ON Semi are plays on the improving automotive and industrial markets. Radio-frequency chipmakers Broadcom, Qualcomm and Skyworks should benefit from the 5G wireless trend, Rakesh said.

As for the others, he likes AMD for continued strength in processors and graphics chips, as well as its acquisition of Xilinx (XLNX).

Micron looks attractive because of the improving memory chip market, Rakesh said. Nvidia should benefit from strength in PC gaming as well as data-center acceleration and artificial-intelligence trends.

AMD, Micron Labeled Buys By Rosenblatt

Meanwhile, Rosenblatt analysts Hans Mosesmann and Kevin Cassidy limited their 2021 top picks to four semiconductor stocks: AMD, Ambarella (AMBA), Micron and Marvell Technology (MRVL).

They see AMD capturing a greater share of the market for central processing and graphics processing units. Meanwhile, Micron is building a competitive advantage through technology advancements.

Ambarella is making progress in its transition from video-processing chips to artificial-intelligence applications.

Marvell is focused on “high-growth, AI-driven data infrastructure markets,” including data center, 5G, edge and automotive applications, Rosenblatt said.

Of the stocks labeled as top picks by Mizuho and Rosenblatt, four are on the IBD 50 list of top-performing growth stocks. They are AMD, Broadcom, Marvell and Nvidia.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.


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