3 Semiconductor Stocks Testing Their All-Time High

Semiconductor stocks have outpaced the S&P 500 by around 25% so far this year as investors bet on insatiable demand, driven by 5G smartphones, artificial intelligence (AI) devices, and a rebound in auto and industrial end markets. Evercore ISI analyst C.J. Muse recently told clients he sees the group growing for the next six to eight quarters, with revenues jumping 14% in 2021 to $500 billion.

Below, we take a look at three leading chip stocks trading near their all-time high (ATH) and point out crucial technical levels worth watching.

Advanced Micro Devices, Inc.

Advanced Micro Devices, Inc. (AMD) designs and manufactures microprocessors for the computer and consumer electronics industries. The Santa Clara company entered its foray into supercomputing in May 2019, announcing that its chips would power Frontier – an exascale system designed to innovate in areas such as AI, machine learning, and data analytics. Analysts expect the chipmaker to post 40% sales growth for fiscal 2021, followed by another 26% in fiscal 2022.

Chart watchers should look for a breakout above a five-month trading range that has established clear resistance around the ATH at $96.37. Look for the bullish momentum to continue on a move through this level.

Analog Devices, Inc.

Massachusetts-based Analog Devices, Inc. (ADI) produces analog, mixed-signal, and digital signal processing chips. The company, which generates about 70% of sales from industrial and automotive end markets, forecasts first-quarter fiscal EPS to come in at $1.30 on revenues of $1.5 billion. This indicates respective top- and bottom-line line growth of 15% and 26% from a year earlier.

Chart wise, the shares broke out from an inverse head and shoulders pattern in early November, suggesting further upside. More recently, the price has remained above the 20-day SMA after reaching its ATH at $146.31 on Dec. 8.

Xilinx, Inc.

Xilinx, Inc. (XLNX) processes and designs integrated circuits for use in communications, data processing, industrial, consumer, and automotive industries. The computer chipmaker has made inroads into the data center market by designing programmable processors that speed up compressing videos and providing digital encryption. In October, Advanced Micro Devices announced that it has agreed to purchase Xilinx in a $35 billion all-stock deal.

After climbing to a new ATH at $151.54 earlier this month, the shares retraced to the April 2019 high, where previous resistance now acts as support. A push higher from this level in recent trading sessions indicates further momentum-based buying.

For a look at today’s earnings schedule, check out our earnings calendar.