Last year was a good one for the major market indices, with the S&P 500 returning almost 27%, while the Dow Jones Industrial Average and the Nasdaq Composite returned 18.7% and 21.4%, respectively. While a semiconductor shortage continues to impact the supply chain, the demand for these chips continues to rise, pushing up their prices.
According to JPMorgan Chase & Co. (JPM) analyst Gokul Hariharan, the chip shortage may drag on this year. But the situation is expected to improve from mid-year onwards. According to an International Data Corporation (IDC) report, the semiconductor market is expected to reach $600 billion by 2025, growing at a 5.3% CAGR, versus its 3% - 4% historic growth.
Synaptics Incorporated (SYNA), SiTime Corporation (SITM), Alpha and Omega Semiconductor Limited (AOSL), and Trio-Tech International (TRT) emerged as the best performing semiconductor stocks last year and are expected to gain further in the near term.
Synaptics Incorporated (SYNA)
SYNA in San Jose, Calif., is a developer and supplier of custom-designed semiconductor solutions that enable people to interact with a range of various mobile computing, communications, entertainment, and other electronic devices. The company operates in the smartphones, tablets, personal computers, and Internet of Things (IoT) markets.
On Dec. 2, 2021, SYNA announced the acquisition of DSP Group, which provides voice processing and wireless chipset solutions. The acquisition bodes well for SYNA as it seeks to utilize DSP’s ULE wireless technology and VOIP processing solutions to cross-sell and deliver differentiated solutions to its customers.
SYNA’s net revenue for its fiscal first quarter, ended Sept. 25, 2021, increased 13.4% year-over-year to $372.70 million. The company’s non-GAAP operating income increased 68.5% year-over-year to $127.60 million. Also, its non-GAAP net income came in at $108.70 million, representing a 63% increase year-over-year.
Analysts expect SYNA’s EPS and revenue for its fiscal 2022 to increase 35.7% and 18.2%, respectively, year-over-year to $11.21 and $1.58 billion. It surpassed the Street’s EPS estimates in each of the trailing four quarters. SYNA stock gained more than 200% in price last year and 150% over the past year to close yesterday’s trading session at $255.15.
SYNA’s POWR Ratings reflect its solid prospects. The company has an overall B rating, which translates to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.
It has an A grade for Growth and a B grade for Momentum. It is ranked #18 of 45 stocks in the B-rated Technology – Electronics industry. Click here to see the other ratings of SYNA for Value, Stability, Sentiment, and Quality.
SiTime Corporation (SITM)
SITM provides silicon timing systems solutions. The Santa Clara, Calif.-based company’s silicon timing solutions comprise micro-electro-mechanical systems resonators and clock integrated circuits. In addition, its product portfolio includes low jitter oscillators, Stratum 3E OCXOs, clock generators, and megahertz oscillators.
On Sept. 29, 2021, SITM introduced its SiT3901 µPower digitally controlled MEMS oscillator targeting power-sensitive and space-constrained mobile and IoT applications. The SiT3901 improves wireless charging speed by up to 25%, while reducing the overall timing solution area by 90%.
SITM’s net revenue increased 92.9% year-over-year to $63 million for the third quarter, ended Sept. 30, 2021. The company’s non-GAAP income from operations increased 127.6% sequentially to $22.02 million. And its non-GAAP net income increased 127.6% sequentially to $21.91 million.
For its fiscal 2021, analysts expect SITM’s EPS and revenue to increase 506.5% and 84.4%, respectively, year-over-year to $2.79 and $214.14 million. It surpassed consensus EPS estimates in each of the trailing four quarters. SITM shares gained more than 150% in price last year and 136% over the past nine months to close yesterday’s trading session at $249.85.
SITM’s strong fundamentals are reflected in its POWR Ratings. It has a B grade for Growth, Momentum, Sentiment, and Quality. Within the A-rated Semiconductor & Wireless Chip industry, it is ranked #75 out of 99 stocks. To see SITM’s ratings for Value and Stability, click here.
Alpha and Omega Semiconductor Limited (AOSL)
Sunnyvale, Calif.-based AOSL designs, develops, and supplies power semiconductors. The company’s portfolio of products focuses on high-volume applications that include personal computers, flat-panel televisions, smartphones, consumer and industrial motor controls. It also offers power semiconductors, including a portfolio of Power MOSFET, IGBT, Power IC, and Digital Power products.
On Dec. 2, 2021, AOSL released its 600V Low Ohmic and Fast Body Diode αMOS5 Super Junction MOSFETs family. αMOS5 is AOSL’s latest high voltage MOSFET that is designed to meet the high efficiency and high-density needs for quick chargers, adapter, PC power, telecom, and hyper-scale data center applications. So, this product could help boost the company’s revenue.
AOSL’s revenue for its fiscal first quarter, ended Sept. 30, 2021, increased 23.3% year-over-year to $187 million. The company’s non-GAAP operating income increased 100% year-over-year to $30.80 million, while its non-GAAP net income increased 102% from the same period last year to $29.30 million.
Analysts expect AOSL’s EPS for the quarter ended Dec. 31, 2021, to increase 60% year-over-year to $1.04. Its revenue for its fiscal 2022 is expected to increase 14.1% year-over-year to $749.50 million. It surpassed the Street’s EPS estimates in each of the trailing four quarters. AOSL’s shares gained more than 130% in price last year and 106.2% over the past year to close yesterday’s trading session at $54.33.
AOSL’s POWR Ratings reflect solid prospects. The company has an overall B rating, which translates to a Buy in our proprietary rating system. AOSL has an A grade for Value and a B grade for Growth and Momentum. It is ranked #31 in the Semiconductor & Wireless Chip industry. Click here to check the other ratings of AOSL for Stability, Sentiment, and Quality.
Trio-Tech International (TRT)
TRT in Van Nuys, Calif., is engaged in providing third-party semiconductor testing and burn-in services. The company’s business segments include manufacturing, testing services, distribution, and real estate. It also designs, develops, manufactures, and markets a range of equipment and systems used to manufacture and test semiconductor devices and electronic components.
On Dec. 6, 2021, TRT announced that it had agreed to a joint venture with a Chinese company with expertise in system level testing. The joint venture company will likely provide testing and burn-in services for various semiconductor components with computing and automotive electronics applications.
TRT’s total revenue increased 49% year-over-year to $10.17 million for its fiscal first quarter, ended Sept. 30, 2021. The company’s manufacturing revenue increased 35.6% year-over-year to $3.56 million. Also, its net income was $917,000, compared to an$8,000 loss in the year-ago period. The stock gained more than 235% in price last year and 151% over the past year to close yesterday’s trading session at $10.21.
TRT’s POWR Ratings reflect solid prospects. It has an A grade for Momentum and a B grade for Growth. The stock is ranked #79 in the Semiconductor & Wireless Chip industry. To see the additional ratings for TRT, click here.
SYNA shares were trading at $254.06 per share on Thursday morning, down $1.09 (-0.43%). Year-to-date, SYNA has declined -12.24%, versus a -1.22% rise in the benchmark S&P 500 index during the same period.
About the Author: Dipanjan Banchur
Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.These were the 4 Best Performing Semiconductor Stocks of 2021 appeared first on StockNews.com