Sheaff Brock Reviews Chip Stocks’ Potential Trading Opportunities



Sheaff Brock CIO Dave Gilreath explores chip stocks and their possible trading opportunities in an article for Financial Advisor Magazine“Why Chip Stocks Are a Near- and Long-Term No-Brainer.”

“Many advisors may be letting the new bear market and fears of near-term recession deter them from taking advantage of low semi valuations. Contrary to the philosophy of strategic opportunism they may espouse, they’re staying away,” Gilreath writes.

Gilreath includes a few points of research to support the possibility of growth “as the super cycle that began in 2020 continues, a report from McKinsey & Co. concludes.”

  • For 2022, growth of about 10% is projected—to a record $600 billion-plus—and by 2030, to more than $1 trillion, reports Deloitte, characterizing this growth as “robust.”
  • These projections are linked with extremely high confidence in the industry—at an all-time high, KPMG reports—regarding performance this year. About 95% of semiconductor company leaders forecast their revenue to grow this year—68% of them at 11% or more. Further, 88% expect to expand capital spending and workforces this year.
  • About 70% of the industry’s growth this year will be driven by just three user industries: automotive, computation, and data storage/wireless.

The highly digital focus of the United States should continue to drive demand for chip stocks, keeping tech as a market driver.