Been throwing some cash at chip maker stocks, mostly scooping up shares of $SMH, for the past year or so. My thinking was pretty straightforward: these guys are like the folks selling the tools during a gold rush. That's been paying off, and I'm betting it's gonna keep on giving for a long while.
So, the word on the street (and by street, I mean analysts) is that the chip market is gonna blow up by like 11% each year for the next five. And honestly, trying to make a case against chips is tough when you've got all sorts of gadgets that need them and they need to be more kickass with each passing year.
Because of the whole mess with the pandemic slowing things down, chip factories are popping up in more places now. Sure, that's a chunk of change that could have been profit, but it means we're less likely to get stuck waiting on parts in the future.
Even with all the dough they're pouring into new plants, the top dog chip makers still have the upper hand with pricing. Demand is through the roof and doesn't look like it's cooling off anytime soon.
AI is the big headliner for chip demand, right? But don't forget all the other stuff that could jack up prices for chip makers. Like if crypto goes bananas again, or everyone starts grabbing these newfangled chips for better video streaming, or there's a big swap from old-school chips to these new energy-saving ones—especially if the next Windows is a hit and gets folks to upgrade. Plus, people might dig doing AI stuff on their own machines instead of online for privacy and all that jazz.
Even with everyone and their mom hyping up chip stocks, I'm not done buying. For all the reasons I just tossed out, you can bet I'll keep on grabbing shares for years to come.