5 Semiconductor Stocks Set For Explosive Growth In Second Half 2024, Says JPMorgan: Nvidia Not Included

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JPMorgan's Harlan Sur highlights Broadcom, Marvell, Micron, Analog Devices, and Microchip as top semiconductor picks.
These companies are expected to benefit from the cyclical recovery and strong AI demand into 2025.
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In the fiercely competitive semiconductor industry, Nvidia Corp often captures the spotlight with its groundbreaking AI advancements. However, the industry’s next major winners might not be the usual suspects.

Enter JPMorgan analyst Harlan Sur, who's set to shine a spotlight on five semiconductor titans poised for explosive growth in the second half of 2024.

Analyst Sees 30-40% EPS Upwards Revisions Over Quarters Ahead

JPMorgan’s top semiconductor picks, according to Sur, include Broadcom Inc AVGO, Marvell Technology Inc MRVL, Micron Technology Inc MU, Analog Devices Inc ADI, and Microchip Technology Inc MCHP. These companies are riding the wave of a cyclical recovery and robust AI demand that shows no signs of slowing.

Sur notes that semiconductor and semi-cap equipment stocks have surged more than 35% year-to-date, significantly outperforming broader indices. This trend, fueled by positive earnings revisions and strong industry fundamentals, is expected to continue through 2024 and into 2025.

5 Semiconductor Stocks Picks Beyond Nvidia

Broadcom (AVGO), for instance, stands out due to its leadership in networking and AI compute. As cloud and enterprise workloads recover, Broadcom's prowess in high-speed networking solutions positions it for substantial gains. Sur emphasizes Broadcom’s pivotal role in the AI infrastructure build-out, a sector experiencing unprecedented growth.

Next, we have Marvell Technology (MRVL). Known for its optical connectivity solutions, Marvell is set to benefit from the increased demand for AI compute and high-speed networking capabilities. Sur is particularly optimistic about Marvell’s potential to capture market share in the AI-driven data center space.

Micron Technology (MU) is another top pick, with its expanding 2.5D packaging solutions and strong memory segment. Despite the recent downturn in memory markets, Sur believes Micron is positioned for a robust recovery as demand for AI and high-performance computing continues to climb.

Sur's list also includes Analog Devices (ADI), which is well-positioned to capitalize on the inflecting demand across various end markets, including automotive and industrial sectors. ADI’s diverse product portfolio and strategic positioning make it a standout choice in the cyclical recovery.

Lastly, Microchip Technology (MCHP) rounds out the list. With improving fundamentals and a strong presence in the IoT and automotive sectors, Microchip is poised for growth as these markets recover in the second half of the year.

JPMorgan's semi-cap equipment favorite, KLA Corporation (KLAC), is also worth mentioning. Sur highlights KLAC’s strong utilization rates and increasing orders for advanced foundry and logic equipment, driven by the demand pull from AI and high-performance computing.

So, while Nvidia continues to dazzle, keep an eye on these five under-the-radar semiconductor stars. According to JPMorgan’s Sur, their time to shine is just around the corner.

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