In this article, we discuss the 5 high-growth semiconductor stocks that are profitable. To read the detailed analysis of the semiconductor industry, go directly to the 12 High Growth Semiconductor Stocks That Are Profitable.
5. ACM Research, Inc. (NASDAQ:ACMR)
Latest Quarter YoY Revenue Growth: 26.1%
Number of Hedge Fund Holders: 21
ACM Research, Inc. (NASDAQ:ACMR) is a California-based company that is involved in the development, manufacturing, and selling of wet processing technology.
Of the 4 Wall Street analysts that covered ACM Research, Inc. (NASDAQ:ACMR), 3 maintained a Buy rating on the stock. The average price target of $24.88 represented an upside of 34.34% as of the December 22 market close.
In the third quarter, 21 hedge funds had investments in ACM Research, Inc. (NASDAQ:ACMR)’s stock, compared to 19 funds in the prior quarter. Ian Trundle’s Pertento Partners was the biggest stakeholder in the company and increased its stake by 4% to 1.195 million shares worth $21.64 million.
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4. Axcelis Technologies, Inc. (NASDAQ:ACLS)
Latest Quarter YoY Revenue Growth: 27.5%
Number of Hedge Fund Holders: 29
Axcelis Technologies, Inc. (NASDAQ:ACLS) is a Massachusetts-based company that offers industrial equipment and services for the semiconductor industry.
In the third quarter, Axcelis Technologies, Inc. (NASDAQ:ACLS) announced its third-quarter earnings result with a GAAP EPS of $1.99, which beat the estimates by $0.26. The revenue rose by 27.5% year-over-year (YoY) to $292.3 million, topping the estimates by $12.06 million.
On December 12, Axcelis Technologies, Inc. (NASDAQ:ACLS) reported the shipment of multiple Purion H SiC Power Series and the Purion M SiC Power Series ion implanter systems to multiple device chipmakers in Europe and Asia. The company also reported the closure of the Purion H200 SiC Power Series evaluation tool in Europe.
On December 7, Axcelis Technologies, Inc. (NASDAQ:ACLS) announced shipping its Purion XE high energy and the Purion H high current implanters to several fabs in Korea and China for the manufacturing of DRAM memory devices.
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3. Arm Holdings plc (NASDAQ:ARM)
Latest Quarter YoY Revenue Growth: 27.9%
Number of Hedge Fund Holders: 35
Arm Holdings plc (NASDAQ:ARM) is a British company that is engaged in the development of central processing unit (CPU) cores and other chips, software development tools, and more.
On November 20, Wells Fargo analyst Gary Mobley initiated coverage of Arm Holdings plc (NASDAQ:ARM)’s stock with an Overweight rating and a $70 price target. The firm called it “one of the best-positioned companies” in the semiconductor industry.
On November 8, Arm Holdings plc (NASDAQ:ARM) posted its Q2 non-GAAP EPS of $0.36, surpassing the estimates by $0.10. The revenue of $806 million grew 27.9% YoY, topping the estimates by $60.25 million.
According to Insider Monkey’s database, 35 hedge funds were bullish on Arm Holdings plc (NASDAQ:ARM)’s stock in the third quarter. Rajiv Jain’s GQG Partners owned 16.39 million company shares worth $877.184 million, making it the most significant investor in the company.
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2. Aehr Test Systems (NASDAQ:AEHR)
Latest Quarter YoY Revenue Growth: 93.3%
Number of Hedge Fund Holders: 13
Aehr Test Systems (NASDAQ:AEHR) is a California-based company that develops and provides burn-in equipment to the semiconductor industry. Aehr Test Systems (NASDAQ:AEHR) is one of the best high-growth semiconductor stocks that are profitable.
On December 14, Aehr Test Systems (NASDAQ:AEHR) announced that it got an initial customer order for a FOX-NP wafer level test and burn-in system and a FOX WaferPak Aligner from a leading semiconductor devices supply company.
According to Insider Monkey’s database that tracks 910 elite hedge funds, 13 hedge funds held a stake in Aehr Test Systems (NASDAQ:AEHR)’s stock in Q3, compared to 12 funds in the previous quarter. With 1.45 million shares worth $66.326 million, Illinois-based Driehaus Capital was the most significant investor in the company.
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1. NVIDIA Corporation (NASDAQ:NVDA)
Latest Quarter YoY Revenue Growth: 205.6%
Number of Hedge Fund Holders: 180
NVIDIA Corporation (NASDAQ:NVDA) is a California-based company that manufactures and sells graphics processors, mobile technologies, and desktop computers.
In the third quarter, hedge fund sentiment was positive toward NVIDIA Corporation (NASDAQ:NVDA)’s stock. 180 hedge funds had investments in the stock, compared to 175 in the previous quarter. The most significant stakeholder in the company was GQG Partners, with 14.04 million company shares worth $6.1 billion.
On December 15, BofA chose NVIDIA Corporation (NASDAQ:NVDA) as one of its five top picks in semiconductors for 2024. The firm has a Buy rating on the stock with a $700 price target.
Blue Tower Asset Management commented on NVIDIA Corporation (NASDAQ:NVDA) in its third quarter, 2023 investor letter. Here is what it said:
“In addition to the use of larger datasets, the training speed of AI models has increased dramatically. NVIDIA Corporation (NASDAQ:NVDA)’s stock almost tripled in the first 3 quarters of this year with a 197% gain, and a large reason for this is the huge role they have played in recent AI improvements. Nvidia’s single GPU AI training speed performance has increased by a dramatic 1000x in 10 years with only 2.5x coming from Moore’s Law3 driven increases in chip density. Besides better chip manufacturing, there were three other improvement factors at play: simplifications in number representation for the weights of the neural networks, more complex mathematical instructions for reducing the computational overhead involved in mathematical calculations, and increased neuron sparsity (in neural networks, some neurons are useless and can be pruned from the network without reducing performance significantly). In addition to these single GPU improvements, Nvidia also made improvements in data center scale architecture that allows groups of GPUs to work more efficiently together.
It is noteworthy that the vast majority of the improvement came from hardware architectural and software data improvements, rather than transition density. These improvements were likely the low-hanging fruit of training speed improvements as researchers will eventually converge on an ideal architecture. The simplification of going from 32-bit to 8-bit floating point numbers for measuring weights is a one-time gain that can’t be repeated again. I expect the rate of improvement to slow down over the next ten years and eventually approach the levels of Moore’s Law improvements in chip efficiency. The historical trend for computer hardware is for it to eventually be commoditized, and I believe this will eventually occur for Nvidia’s GPUs as well.”
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