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Despite the current semiconductor chip shortage, the global semiconductor industry witnessed 29.7% year-over-year sales growth in August 2021. To address the shortage crisis and satisfy surging demand, governments and enterprises are making considerable investments in the industry. This, combined with recent technological breakthroughs made by chipmakers, positions the industry for solid growth.
Investor optimism in this space is evident in the SPDR S&P Semiconductor ETF’s (XSD) 13.8% gains over the past three months, versus the SPDR S&P 500 Trust ETF’s (SPY) 4.1% returns. The global semiconductor market is expected to grow at a 7.7% CAGR to $778 billion by 2026. So, both AMAT and LRCX should benefit.
