Friday, 23 February 2024

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Goldman Sachs Chooses the Best Chip Stock to Buy – TipRanks Financial Blog

Goldman Sachs Chooses the Best Chip Stock to Buy – TipRanks Financial Blog

Every savvy investor seeks out the golden opportunities within the market. One effective strategy involves investing in an essential commodity or product, something that the economy cannot do without. It’s a common-sense way to find companies that are sure to generate steady revenues.

In today’s world, few products are more essential than the silicon semiconductor chip. Found in everything from wristwatches to smartphones and tablets to automobiles to jet airliners, these chips make almost all modern technology possible.

The surge in generative AI technology that has powered the tech industry’s gain in recent months rides on the back of high-end, high-capacity processor chips. That surge has also been helped along by government policy. The Biden Administration pushed hard for the CHIPS Act, to subsidize reshoring of the US semiconductor industry, and the first tranche of that money hit the chip scene at the end of last year.

This gives firm support to the chip industry, and sets the table for plenty of investor interest. But not all chip stocks are created equal, and some offer better opportunities than others. This is where Goldman Sachs comes into play.

The investing giant has taken the measure of the largest chip stocks, and lays out just which ones are right to buy. Nvidia (NASDAQ:NVDA) and Intel (NASDAQ:INTC), in particular, have caught Goldman’s interest, and for good reason. Nvidia, one of the Magnificent 7 tech leaders, is one of the half-dozen trillion-dollar-plus companies on Wall Street and holds the title of the world’s largest chip maker by market cap. Intel, with a smaller market cap, still maintains its position in the top ten of the chip space and has long been a leader in the field.

So, let’s delve into Goldman’s insights to determine which chip stock emerges as the top pick for investment.


We’ll start with Nvidia. This company, as noted, has in recent years reached the top rungs of the trading world – and a market cap valuation of $1.78 trillion. This makes the chip maker the fifth-largest publicly traded firm on Wall Street.

Nvidia reached these heights on the back of a massive surge in share value over the past year or more. Some numbers will paint the picture: in the last 3 years, Nvidia’s stock is up almost 400%. The 12-month gain is 215%; in just the first few weeks of 2024, NVDA has continued to gain, tacking on another 45%.

The company’s huge rise in share price has…

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