Grab These 3 Stocks With Upside as Semiconductor Sales Skyrocket

The semiconductor market, which started rebounding earlier last year, carried the momentum and ended 2024 on a high. Semiconductor sales made a solid jump in 2024, with the final quarter proving to be one of the best.The jump in sales witnessed over the past few quarters is being powered by robust enthusiasm surrounding artificial intelligence (AI), especially generative AI. Last month, semiconductor stocks, particularly those involved in AI, suffered after the launch of DeepSeek, a low-cost AI model from China. DeepSeek’s rise raised concerns of an imminent threat to the dominance of U.S. tech companies in the AI space. However, those concerns soon faded, and optimism began to return.Given this scenario, it would be ideal to invest in semiconductor stocks such as NVIDIA Corporation NVDA, Taiwan Semiconductor Manufacturing Company Limited TSM and RF Industries, Ltd. RFIL. Each of these stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Semiconductor Sales Jump in 2024The Semiconductor Industry Association (SIA) said recently that global semiconductor sales totaled $627.6 billion in 2024, up 19.1% from last year’s total of $526.8 billion. Sales also jumped a solid 17.1% year over year in the fourth quarter of 2024, totaling $170.9 billion, and up 3% sequentially.The announcement from SIA comes just days after a separate report from Gartner showed global semiconductor sales hit $626 billion in 2024, up 18.1% year over year. The report also projected semiconductor sales to hit $705 billion this year.High demand for semiconductors at data centers has been boosting sales. Also, the memory market played a key role in driving semiconductor sales in 2024, with revenues skyrocketing by 71.8% compared to the previous year.Semiconductor Market Poised to GrowA large number of technology companies have been heavily investing in AI and its development. Businesses that have deeply incorporated AI into their products have seen significant expansion in recent years.Last month, Chinese startup DeepSeek shook up the U.S. AI space by introducing a free, open-source assistant that it claims operates with lower-cost chips and requires less data. The company said that developing the AI model cost under $6 million, raising doubts about the assumption that AI would drive strong demand throughout the supply chain, from semiconductor manufacturers to data centers.As a result, tech and semiconductor stocks suffered a sharp decline. However, concerns quickly eased as analysts suggested that the Chinese model was overestimated.Experts believe AI still has vast untapped potential. The growing optimism is expected to push demand even further as more semiconductor firms enter the AI race.3 Semiconductor Stocks with Growth PotentialNVIDIA CorporationNVIDIA Corporation is a major player in the semiconductor industry and has been one of the standout success stories of 2023 and 2024. As a leading designer of graphic processing units (GPUs), the value of the NVDA stock tends to surge in a thriving crypto market. This is primarily due to the crucial role that GPUs play in data centers, artificial intelligence, and the mining or production of cryptocurrencies.NVIDIA’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 4.3% over the past 90 days. Currently, NVIDIA has a Zacks Rank #2.Taiwan Semiconductor Manufacturing Company LimitedTaiwan Semiconductor Manufacturing Company Limited is the world's largest dedicated integrated circuit foundry. As a foundry, TSM manufactures ICs for its customers based on their proprietary IC designs using its advanced production processes. Taiwan Semiconductor Manufacturing Company Limited’s goal is to establish itself as one of the world's leading semiconductor companies by building upon the strengths that have made it the world's leading IC foundry.Taiwan Semiconductor Manufacturing Company Limited’s expected earnings growth rate for the current year is 29.6%. The Zacks Consensus Estimate for current-year earnings has improved 3.5% over the past 90 days. TSM presently carries a Zacks Rank #2.RF Industries, Ltd.RF Industries, Ltd. is engaged in the design, manufacture and distribution of coaxial connectors used in radio communications applications as well as in computers, test instruments, PC LANS and antenna devices.RF Industries’ expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 40% over the past 90 days. RFIL presently carries a Zacks Rank #2.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NVIDIA Corporation (NVDA): Free Stock Analysis Report Taiwan Semiconductor Manufacturing Company Ltd. (TSM): Free Stock Analysis Report RF Industries, Ltd. (RFIL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks