Nvidia, Monolithic Power, Broadcom, Marvell top chip stocks at Oppenheimer
Oct. 03, 2023 10:32 AM ET
By: Chris Ciaccia, SA News Editor
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 Justin Sullivan
Investment firm Oppenheimer said on Tuesday that Nvidia (NASDAQ: NVDA), Monolithic Power (NASDAQ: MPWR), Broadcom (NASDAQ: AVGO) and Marvell Technology (NASDAQ: MRVL) are its top semiconductor stocks following a recent channel check into the industry.
A group of analysts, led by Rick Schafer, found that channel inventories have improved or come back to normal, but demand is "broadly soft" outside of a few places, including artificial intelligence and automotive, which could impact the size and scope of the recovery, as well as any near-term visibility.
They added that China is struggling, due in part to country's real estate crisis, which is impacting saving and spending and any recovery next year is "uncertain at best."
Additionally, the team found that the PC supply chain has normalized, with roughly two months of inventories, though the third-quarter is seen as tracking "below normal seasonality." Traditional servers are also down, roughly 20% this year, though there is the expectation that orders will start to stabilize by the end of the year, setting up a "steady 2024."
Conversely, AI-centric servers are growing at rates faster than 20%, while GPU constraints, in particular from Nvidia's ( NVDA) H100 may be limiting AI servers from growing even faster. They said that chip-on-wafer-on-substrate capacity should improve in the second-half of the year, especially at Taiwan Semiconductor ( TSM), which should help H100 supply.
They also noted that foundry utilization rates are still below 70%, though some nodes are better, with some foundries, not including Taiwan Semiconductor, offering discounts and promotions.
Geographically, foundries in China are seeing lower performance, quality and yields, while India is dealing with growing pains. However, Mexico should see "significant capacity expansion" in the coming years, they added. |
