Semiconductor companies have been a portion of the market that has seen exponential growth over the last few years and shows no sign of stopping. The hype still surrounding generative A.I. technology, as well as other burgeoning technology uses for semiconductors, will continue to grow. The benchmark ETF regarding semiconductors is the VanEck Semiconductor ETF (NYSEARCA:SMH), which is comprised of the 25 largest U.S.-based semiconductor companies and. It has over $11 billion in assets under management, and over this last year, its share price has risen by 70%.
For this article, I chose three semiconductor stocks that aren’t necessarily the most popular, but they are companies with the potential to experience a large amount of growth in 2024.
Navitas Semiconductor (NVTS)
Navitas Semiconductor (NASDAQ:NVTS) located in Torrance, California, designs and manufactures gallium nitride integrated circuits that provide fast charging and energy-saving capabilities along with other power conversion products for use in mobile phones, data centers, electric vehicles and other products.
On November 9, Navitas announced its third quarter earnings results which stated that its total revenue had more than doubled compared to the previous year. The company also narrowed its losses year-over-year. The business outlook for the fourth quarter of 2023 is expected to result in revenue between $25 – $26 million. And their gross margins are projected to increase to 42.5%.
The launch of its gallium nitride power semiconductor GaNSafe is gaining traction in the generative AI space. Shares have risen by approximately 130% within the past year.
ASE Technology Holding (ASX)
Source: William Potter / Shutterstock.com
ASE Technology Holding (NYSE:ASX) headquartered in Taiwan is a manufacturer of semiconductor packaging and also offers electronic testing services. ASE Technology operates offices out of Taiwan, Malaysia, South Korea, Singapore, China, Japan, and the U.S.
On October 26 the company saw an 18% year-over-year revenue decline in the third quarter. The company’s net income was cut in half compared to the year before.
Their packaging and testing business segment was down by 15% year-over-year, and their five largest customers accounted for 42% of their revenue. Their electronic design and manufacturing services segment experienced a drop in revenue of 22% within the same period, and their top 5 customers accounted for 70% of their total sales.
It also offers a decent dividend payout to its investors of approximately 6.60%, which it distributes once a year. Their last dividend payment was $0.57 per share in August. The stock has risen by 40% year-to-date.
Source: Michael Vi / Shutterstock.com
Qorvo (NASDAQ:QRVO) is located in Greensboro, North Carolina. The company designs and manufactures semiconductor products through multiple segments, including their high-performance analog and radio frequency. This technology is used in cellular infrastructure and the aerospace and defense industry. The connectivity and sensors segment supplies technology for Bluetooth and Wi-Fi applications. There is also the advanced cellular segment, which supplies radio frequency technology for use in phones, tablets, and other electronic equipment.
On November 1, Qorvo reported its earnings result for the second quarter of fiscal year 2024, which stated that its revenue dropped by 5% and its net income fell by 48% year-over-year. Qorvo also reported that their quarter-over-quarter revenue rose by 70%, and their product adoption for Android smartphones has grown.
On December 18, Qorvo announced a partnership with Luxshare Precision Industry, an electronic components manufacturer in China. The partnership details include that Luxshare will acquire the testing facilities in Dezhou and Beijing, China, that Qorvo owns.
Within the last year, the company has seen its share price rise by 24%. In early December, Morgan Stanley(NYSE:MS) upgraded Qorvo from equal-weight to overweight and increased its price target to $134 per share. This was due to the firm’s belief that Qorvo is trading at a cheap rate, considering its positive earnings potential.
As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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