10 Best Semiconductor Equipment Stocks to Buy Now

1. Applied Materials, Inc. (NASDAQ:AMAT)

Number of Hedge Fund Holders In Q3 2024: 74

Applied Materials, Inc. (NASDAQ:AMAT) is an American firm that sells products used in different chip fabrication processes such as deposition and etching. Its products cater to the needs of chip fabrication, display manufacturing, and other industries. Applied Materials, Inc. (NASDAQ:AMAT)’s shares are up by 9.70% year-to-date as they have been hit particularly hard by the tensions between the US and China. During its fiscal year 2024, 37% of the firm’s revenue came from China. Applied Materials, Inc. (NASDAQ:AMAT)’s stock dropped by 11% in July after reports claimed that the US government could even restrict foreign companies using materials sourced from America from selling their products to China. However, as the industry shifts to new technologies such as gate-all-around transistors, Applied Materials, Inc. (NASDAQ:AMAT) can enjoy favorable catalysts in the future.

Parnassus Investments mentioned Applied Materials, Inc. (NASDAQ:AMAT) in its Q3 2024 investor letter. Here is what the fund said:

“Applied Materials, Inc. (NASDAQ:AMAT), the world’s largest supplier of wafer fabrication equipment for semiconductors, saw its shares pressured by negative sentiment around a potentially broad-based trend of capital expenditure cuts in memory spending.”

AMAT is a semiconductor equipment stock that hedge funds are buying. While we acknowledge the potential of AMAT as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AMAT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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