{"id":107790,"date":"2017-06-21T10:17:07","date_gmt":"2017-06-21T14:17:07","guid":{"rendered":"http:\/\/countingpips.com\/?p=107790"},"modified":"2017-06-21T07:21:29","modified_gmt":"2017-06-21T11:21:29","slug":"cheat-code-to-riches-the-best-way-to-profit-from-the-semiconductor-industry","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/06\/cheat-code-to-riches-the-best-way-to-profit-from-the-semiconductor-industry\/","title":{"rendered":"\u201cCheat Code\u201d to Riches: The Best Way to Profit from the Semiconductor Industry"},"content":{"rendered":"<div id=\"inves-1009588160\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">June 21, 2017<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p>By <a href=\"http:\/\/WallStreetDaily.com\/\"><u>WallStreetDaily.com<\/u><\/a> <img loading=\"lazy\" decoding=\"async\" class=\"attachment-home-th size-home-th wp-post-image\" style=\"display: block; margin-bottom: 5px; clear: both;\" src=\"https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/06\/0617_semiconductors_feature.jpg\" sizes=\"auto, (max-width: 580px) 100vw, 580px\" srcset=\"https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/06\/0617_semiconductors_feature.jpg 580w, https:\/\/s3.amazonaws.com\/wallstreetdailywebsite\/wp-content\/uploads\/2017\/06\/0617_semiconductors_feature-300x155.jpg 300w\" alt=\"\u201cCheat Code\u201d to Riches: The Best Way to Profit from the Semiconductor Industry\" width=\"580\" height=\"300\" \/><\/p>\n<ul>\n<li>Ignore the hyperbole surrounding tech\u2019s demise.<\/li>\n<li>One corner of the market boasts untapped potential.<\/li>\n<li>Four-letter ticker symbol included below.<\/li>\n<li><strong><a href=\"https:\/\/pro.agorafinancial.com\/m\/697880\" target=\"_blank\" rel=\"noopener\">Also recommended: Meet oil\u2019s permanent replacement\u2026<\/a><\/strong><\/li>\n<\/ul>\n<hr \/>\n<p><img decoding=\"async\" style=\"float: left; max-width: 85px;\" src=\"https:\/\/duip7hn7nchpo.cloudfront.net\/editor-circle-louis-basenese.jpg\" alt=\"Louis Basenese\" \/><i>Tech Tantrum\u2026 Tech Wreck\u2026 Tech Tank<\/i>\u2026<\/p>\n<p>If you follow stocks, you\u2019ve seen one or more of these clever terms to describe the steep sell-off in technology names last week.<\/p>\n<p>To be sure, XLK \u2014 the exchange-traded fund that tracks large-cap tech \u2014 fell 2.5% two Fridays ago.<\/p>\n<p>That\u2019s the fund\u2019s second largest one-day drop of the year.<\/p>\n<p>Yes, enthusiasm for tech stocks is palpable.<\/p><div id=\"inves-3848972494\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p>But as senior analyst Jonathan Rodriguez points out below, there\u2019s a good reason for it. And he\u2019ll reveal one of the sector\u2019s biggest bargains.<\/p>\n<p>Ahead of the tape,<\/p>\n<p>Louis Basenese<br \/>\nChief Investment Strategist, <em>Wall Street Daily<\/em><\/p>\n<hr \/>\n<h2 class=\"centered headline\">Be Not Afraid\u2026 Be Greedy<\/h2>\n<p><img decoding=\"async\" style=\"float: left; max-width: 85px;\" src=\"https:\/\/duip7hn7nchpo.cloudfront.net\/editor-circle-jonathan-rodriguez.jpg\" alt=\"Jonathan Rodriuez\" \/>Man, you can really cut through the market\u2019s fear with a knife.<\/p>\n<p>Between the Trump administration, the pending divorce of the United Kingdom from the European Union and China\u2019s growth by debt expansion\u2026<\/p>\n<p>There\u2019s a lot on the minds of investors these days.<\/p>\n<p>Flip on the tube and the talking heads are fueling the fire with contradicting bullish and bearish takes.<\/p>\n<p>Yes, valuations are high and stocks will correct at some point. Heck, we may even see a bear market in equities in the next few years.<\/p>\n<p>But make no mistake, as long as corporate earnings are rising and interest rates are low, this market will continue to rally.<\/p>\n<p>And the sector leading the charge for U.S. stocks by far is \u2014 you guessed it \u2014 tech.<\/p>\n<p>In the first quarter of 2017, 84% of large-cap tech firms beat second-quarter analyst earnings estimates, according to FactSet.<\/p>\n<p>That\u2019s nine percentage points higher than the S&amp;P 500 (75%), and a larger beat rate than any other sector.<\/p>\n<p>It gets better\u2026<\/p>\n<p>FactSet also notes that earnings for the semiconductor industry are expected to grow by 40% in the second quarter.<\/p>\n<p>As you know, semiconductors are at the heart of every electronic device on the planet.<\/p>\n<p>And with 2.5 billion devices expected to ship worldwide next year \u2014 up 6% from 2015, according to Gartner \u2014 the $34 billion semi industry isn\u2019t slowing down anytime soon.<\/p>\n<p>However, semiconductor names aren\u2019t cheap by any means.<\/p>\n<p>The benchmark Philadelphia Semiconductor Index is currently trading at 29 times trailing earnings \u2014 a 55% premium to the Nasdaq Composite Index.<\/p>\n<p>But I\u2019ve got a way to play incredible upside in chips <i>without<\/i> the hefty surcharge\u2026<\/p>\n<h2 class=\"subhead\">The Cheat Code to Play Chips Cheap<\/h2>\n<p><b>Ichor Holdings Ltd. (NASDAQ: ICHR)<\/b> is a California-based semiconductor services company.<\/p>\n<p>And this tiny industrial firm \u2014 boasting a market capitalization of just $613 million \u2014 is one of tech\u2019s biggest hidden bargains.<\/p>\n<p>Ichor specializes in fluid delivery subsystems for semiconductor capital equipment.<\/p>\n<p>I know that\u2019s a mouthful. So let me break it down for you\u2026<\/p>\n<p>The semiconductor capital equipment industry builds the machines that companies use to produce chips.<\/p>\n<p>Ichor specializes in the systems that companies use to precisely deliver the chemical fluids needed to build semiconductors.<\/p>\n<p>Some of their customers include Applied Materials Inc. and Lam Research Corp. \u2014 two of America\u2019s largest chipmakers.<\/p>\n<p>Sales have exploded over the last three years. The company booked revenue of $405.7 million in 2016 \u2014 a 40% increase from the previous year.<\/p>\n<p>And after two years of posted losses in 2014 and 2015, the company swung to a profit last year of $3.66 per share.<\/p>\n<p>Analysts expect sales to rise this year to $576 million \u2014 a rise of 42%, and three times the growth of the industry (14.4%).<\/p>\n<p>Fiscal 2017 earnings are also expected to grow 56% \u2014 from $1.32 to $2.05 \u2014 compared with the industry\u2019s 36% growth rate.<\/p>\n<p>Despite Ichor\u2019s phenomenal growth, however, the company trades at a mere 10 times forward earnings \u2014 well below the industry average (35.5).<\/p>\n<p>The company also trades at 0.8 enterprise value to sales. That\u2019s less than half the industry multiple (1.9x).<\/p>\n<p>Bottom line: Fueled by strong earnings growth, the uptrend in tech is far from dead. And the bargain-priced Ichor allows investors to capture the juicy upside in semiconductors without taking on the premium valuation in chip stocks.<\/p>\n<p>On the hunt,<\/p>\n<p>Jonathan Rodriguez<br \/>\nSenior Analyst, <i>Wall Street Daily<\/i><\/p>\n<p>The post <a href=\"https:\/\/www.wallstreetdaily.com\/2017\/06\/21\/cheat-code-riches-best-way-profit-semiconductor-industry\/\" rel=\"nofollow\">\u201cCheat Code\u201d to Riches: The Best Way to Profit from the Semiconductor Industry<\/a> appeared first on <a href=\"https:\/\/www.wallstreetdaily.com\" rel=\"nofollow\">Wall Street Daily<\/a>.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By WallStreetDaily.com Ignore the hyperbole surrounding tech\u2019s demise. One corner of the market boasts untapped potential. Four-letter ticker symbol included below. Also recommended: Meet oil\u2019s permanent replacement\u2026 Tech Tantrum\u2026 Tech Wreck\u2026 Tech Tank\u2026 If you follow stocks, you\u2019ve seen one or more of these clever terms to describe the steep sell-off in technology names last [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-107790","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/107790","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=107790"}],"version-history":[{"count":3,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/107790\/revisions"}],"predecessor-version":[{"id":107800,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/107790\/revisions\/107800"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=107790"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=107790"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=107790"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}