From Nasdaq:

Today’s focus on 4 major companies in the semiconductors industry uncovers how global macroeconomic challenges and geo-political tensions are impacting the industry. Despite these challenges, companies such as Advanced Micro Devices, ASE Technology, Cirrus Logic, and QuickLogic are benefiting from the increasing demand for high-volume consumer electronic devices. The growing proliferation of AI, Machine Learning and Blockchain is also driving industry growth.

The Zacks Electronics – Semiconductors industry includes companies that provide a range of semiconductor technologies, packaging and test services, and intelligent product development. These firms cater to consumer electronics, communications, computing, industrial and automotive end-markets.

However, the global macroeconomic environment poses challenges for semiconductors due to rising inflationary pressure and fears of recession, impacting the rate of deal wins. Geo-political tensions, especially between the United States and China, are creating headwinds for the industry due to dependency on semiconductors for AI-backed electronic devices.

Despite these challenges, the smart devices industry is aiding computing demand, driving a positive outlook for the industry. However, Zacks Industry Rank indicates bleak prospects, with earnings estimates moving 4.2% down for the current year.

Despite these challenges, companies in the Electronics – Semiconductors industry have collectively surged 74.6% in the past year, outperforming the S&P 500 and the broader sector. On a valuation basis, the industry is currently trading at 25.67X, up from a median of 16.55X over the past five years.

Among the 4 companies discussed in this article, Cirrus Logic, QuickLogic, Advanced Micro Devices, and ASE Technology show varying potential for future growth based on earnings estimates and company performance. Despite the overall industry challenges, these companies are positioned to outperform the market based on a strong earnings outlook and market valuation.



Read more: Zacks Industry Outlook Highlights Advanced Micro Devices, ASE Technology, Cirrus Logic and QuickLogic