The Best Semiconductor Stocks to Trade This Week

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Semiconductor stocks are rallying. Experts believe the market could close 2019 with a strong performance. Renewed optimism surrounding the US-China deal had a significant impact on the performance of this sector. 

Slowing sales of mobile phones and other devices plagued the industry over the past few months. Continued trade tensions between the United States and China contributed significantly to the slowdown.

However, with a phase-one China trade deal in the works, the market sentiment towards semiconductor stocks is swinging rapidly. These stocks are on fire right now and there’s no end in sight.

Semiconductor Stocks: Latest News

Chip stocks could end the year with a bang. On Friday, White House adviser Larry Kudlow pointed out that President Trump is very optimistic about reaching a trade deal with China. According to Kudlow, the two countries are on track to complete Phase One of the agreement, and they will likely sign the trade deal before the end of the month. This news has lifted chip stocks, the semiconductor sector been a solid performer over the past few days.

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Wilbur Ross, U.S. Secretary of Commerce, is optimistic that a phase-one trade deal could be signed as soon as next month. Above: Ross is photographed at a meeting of top Chinese and American diplomats.

The Secretary of Commerce, Wilbur Ross, recently stated that the ban on Huawei could be lifted soon. The federal government could begin allowing U.S. businesses to work with Huawei as part of the Phase-One deal. This is positive news for the semiconductor industry because many companies prefer to use Huawei’s affordable hardware.

The Best Chip Stocks to Trade This Week

With these exciting developments, semiconductor stocks have been performing excellently. Let’s take a look at the best semiconductor stocks to trade for the week.

Marvell Stock (NASDAQ: MRVL)

Chipmaker Marvell Technology (MRVL) is rallying this week and it’s expected to surge higher before the end of the week. The stock was up 5% in the premarket session on Monday, November 4. By the end of yesterday’s trading session, MRVL was up by 6.6%.

The stock has been trending upward over the past few days and the momentum has carried it through several sessions. Wells Fargo Analyst Gary Mobley recently upgraded Marvell to “outperform” from “market perform.”  He also increased his price target from $25 to $32 per share. Mobley believes the company’s 5G investments are close to paying off.

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Nvidia is finally back above $200 per share and could be on track to close the year with a strong performance. Above: Nvidia GTX980 GPU.

Nvidia (NASDAQ: NVDA)

Similar to Marvell, Nvidia is benefitting from the ramp-up of its 5G business. As a result, its strong momentum could carry through to the rest of the week. Nvidia’s stock (NVDA) closed Monday’s session at $210.50 per share and capped off a 3.9% move over the last 24 hours. In addition, NVDA experienced a massive surge over the past 30 days. On October 7, shares were as trading for $184.33 but, after an epic rally, they’re currently at $210.50.

Nividia recorded poor sales in its cryptocurrency business last month. Now, it’s looking to its other businesses to pick up the slack. The chipmaker is planning to expand its operations in the AI sector, including implementation in supercomputers, smartphones, cloud services, and data centers sectors. Nvidia is also working to capture more market share through its data center business. Nvidia’s partnered with Microsoft in August to provide RTX ray-tracing technology for use in Microsoft video game consoles, and that arrangement also contributed to Nvidia’s recent rally.

Wall Street expects Nvidia’s revenues to contract by 8% in the third quarter, year-over-year, and consensus earnings estimates predict and EPS decline of 12%  over last year. Analysts expect revenues to return to stable growth next year.

Qorvo (NASDAQ: QRVO)

Greensboro, N.C.-based chipmaker, Qorvo, rallied along with the rest of the hot semiconductor stocks this week. The chip manufacturer released a better-than-expected earnings report last Thursday, and share prices rallied over 20% as a result. Qorvo 5G wireless business was the star of the show. The company is capturing more market share and it’s beginning to emerge as a leading player in the 5G smartphone chip sector.

Qorvo forecasted revenues between $840 million to $860 million for the next quarter, well above Wall Street consensus estimates of only $758 million. The company is benefiting from increased demands for mobile chips, including its very promising 5G business.

More Hot Semiconductor Stocks

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Chris Dios is an American writer and entrepreneur based in the Greater NYC area.

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