Yeah, it's sort of hard to reconcile the "unexpected strength in the US economy" with weakness in industrial and auto semis, and phenomenal strength in parallel processing chips (NVDA, called "AI" by everyone, but it's just parallel processing displacing Intel I think, so more NVDA share gains in perhaps a normal semi market).
Maybe China is weak.
I think cell phones and PCs are doing well, and they are a HUGE portion of semis.
NVDA did $18b last Q, so they're on about an $80b run rate.
Their market cap is $1,700b. That's about 20x sales. Ok. It seems nuts, but it's hard to bet against. Some day it will return to planet earth, but I don't know when.
Semis seem to be all over the map in terms of growing and shrinking, depending on focus area. However, they seem to trade as a group often, so even though one of my preferred picks (MCHP) did poorly in Q4, and guided Q1 WELL BELOW expectations of 3-4 months ago, the share price has held up. That's nice.
My semi strategy is just own MCHP and ADI, and do nothing for the long term. So far it's OK. |
