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Semiconductors, commonly referred to as microchips, are a bright highlight of technology, existing in nearly every aspect of our lives.
Over the last several years, chip stocks have exploded in popularity, and for an easy-to-understand reason – they have been stellar investments.
And for those seeking exposure, several chip stocks – Micron Technology (MU - Free Report) and ASML (ASML - Free Report) – have all seen their near-term earnings outlooks shift favorably, reflecting optimism among analysts.
Let’s take a closer look at each.
Micron Technology
Micron manufactures and markets high-performance memory and storage technologies. The stock is a Zacks Rank #1 (Strong Buy), with expectations moving higher across the board in a big way.
Image Source: Zacks Investment Research
On top of semiconductor exposure, investors stand to reap a passive income stream, with MU shares currently yielding 0.5% annually. While the yield isn’t that steep, it provides a nice buffer against potential drawdowns.
And Micron’s forecasted growth is impossible to ignore, with consensus expectations for its current fiscal year suggesting 90% earnings growth on 43% higher sales. Peeking ahead, expectations for FY25 allude to an additional jump in earnings paired with a 45% sales bump.
ASML
ASML is a world leader in manufacturing advanced technology systems for the semiconductor industry. The company has seen its earnings outlook inch higher across nearly all timeframes, helping land it into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
Like MU, ASML shares come with the perk of passive income, with ASML’s annual dividend currently yielding 0.7%. And the company has been committed to increasingly rewarding shareholders, with ASML carrying a sizable 33.4% five-year annualized dividend growth rate.
Shares are expensive but less so on a historical basis, with the current 35.5X sitting beneath the 36.1X five-year median and highs of 55.4X in 2021. The stock sports a Value Style Score of ‘D.’
Image Source: Zacks Investment Research
Bottom Line
Semiconductor stocks have enjoyed great runs over the last several years, quickly becoming cherished among investors.
And for those interested in exposure, both stocks above – Micron Technology (MU - Free Report) and ASML (ASML - Free Report) – precisely fit the criteria. In addition to favorable Zacks Ranks, both stocks pay out dividends, undoubtedly another great perk.
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2 Top-Ranked Chip Stocks to Buy for Income
Semiconductors, commonly referred to as microchips, are a bright highlight of technology, existing in nearly every aspect of our lives.
Over the last several years, chip stocks have exploded in popularity, and for an easy-to-understand reason – they have been stellar investments.
And for those seeking exposure, several chip stocks – Micron Technology (MU - Free Report) and ASML (ASML - Free Report) – have all seen their near-term earnings outlooks shift favorably, reflecting optimism among analysts.
Let’s take a closer look at each.
Micron Technology
Micron manufactures and markets high-performance memory and storage technologies. The stock is a Zacks Rank #1 (Strong Buy), with expectations moving higher across the board in a big way.
Image Source: Zacks Investment Research
On top of semiconductor exposure, investors stand to reap a passive income stream, with MU shares currently yielding 0.5% annually. While the yield isn’t that steep, it provides a nice buffer against potential drawdowns.
And Micron’s forecasted growth is impossible to ignore, with consensus expectations for its current fiscal year suggesting 90% earnings growth on 43% higher sales. Peeking ahead, expectations for FY25 allude to an additional jump in earnings paired with a 45% sales bump.
ASML
ASML is a world leader in manufacturing advanced technology systems for the semiconductor industry. The company has seen its earnings outlook inch higher across nearly all timeframes, helping land it into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
Like MU, ASML shares come with the perk of passive income, with ASML’s annual dividend currently yielding 0.7%. And the company has been committed to increasingly rewarding shareholders, with ASML carrying a sizable 33.4% five-year annualized dividend growth rate.
Shares are expensive but less so on a historical basis, with the current 35.5X sitting beneath the 36.1X five-year median and highs of 55.4X in 2021. The stock sports a Value Style Score of ‘D.’
Image Source: Zacks Investment Research
Bottom Line
Semiconductor stocks have enjoyed great runs over the last several years, quickly becoming cherished among investors.
And for those interested in exposure, both stocks above – Micron Technology (MU - Free Report) and ASML (ASML - Free Report) – precisely fit the criteria. In addition to favorable Zacks Ranks, both stocks pay out dividends, undoubtedly another great perk.