With so many electric vehicle (EV) stocks that have gone public in the last year -- some of them with uncertain futures -- it might be hard to choose a winner. But here's an alternative: semiconductor stocks. Semiconductors are the basic building blocks of all technology, and they're gobbling up supplier share of the auto industry. According to estimates, electronic components went from 22% of the cost to produce a car in 2000 to 35% in 2010, to about 40% today -- and could be a whopping 50% by the end of this decade. 

Clearly, the already well-established but still fast-growing semiconductor industry is a great way to bet on EVs and other auto tech without needing to pick which automaker will be the biggest winner. Three chip stocks to consider are NXP Semiconductors (NXPI -1.39%), Skyworks Solutions (SWKS -1.33%), and Taiwan Semiconductor Manufacturing (TSM -3.54%).

Someone in a car taking the keys from someone pictured off screen.

Image source: Getty Images.

NXP: A top supplier for auto parts

NXP Semiconductors is one of the most focused electronics suppliers to the auto industry. In fact, during its last quarter, it reported that 49% of its sales went to automakers, and that segment boomed 87% year-over-year. 

Granted, the big boost to NXP's auto business can be attributed to automakers being on lockdown last spring when the pandemic started. With vehicles rolling off assembly lines in droves to keep up with booming demand this year, it's no wonder NXP is getting a lift from the industry. However, this is more than a one-off story. 

As was already discussed, technology is eating up a growing share of the cost to produce a vehicle, and NXP is at the forefront of this movement. It provides all sorts of circuitry that goes into modern car or truck production, from powertrain electrification to in-car connectivity to the infotainment system. And the company is constantly improving its hardware designs, as well as its manufacturing capabilities (including three fabs here in the States), to better support its customers.

During Q2 2021, NXP said revenue and adjusted operating income grew a respective 43% and 121% year-over-year, driven primarily by autos. For Q3, it expects revenue to advance another 22% to 29% year-over-year, with profit margins staying even with Q2 levels or slightly improving. The stock trades at a modest 26 times trailing 12-month free cash flow after the last report. NXP also sweetens the deal with a 1.1% dividend yield and returns additional cash via share repurchases. Given the long-term growth opportunity this top automotive supplier has ahead of it, it looks like a top chip stock buy right now.

Skyworks Solutions: Betting on new auto tech via acquisition

Skyworks Solutions is a connectivity chip designer, best known for providing radio frequency components and related circuitry for Apple and other smartphone makers. This has been a hot market for Skyworks as of late, and it's cranking out 5G network chips so consumers can connect to the next-gen network. 

But Skyworks has been developing its business outside of smartphones as well, expanding into areas it labels "broad markets" such as Wi-Fi connectivity, smart audio, and industrial and automotive chips. Broad markets grew 50% year-over-year in the last quarter, and they make up about one-third of Skyworks' total sales.

And the segment is about to get a big boost. Skyworks just completed the acquisition of Silicon Labs' (SLAB -0.92%) infrastructure and automotive business for $2.75 billion. This breaks ground on several new fronts for the connectivity chip leader, including EVs and the auto industry at large. Included in the infrastructure and automotive business are motor control components, power supply management, and connectivity infrastructure (which also goes into modern vehicle design to help various systems of the car communicate with each other). This puts Skyworks on the EV industry map in a potentially big way, with a robust portfolio of products for many automakers' electronics needs.

Skyworks is growing fast and generating ample profitability, with 36% adjusted operating margins in the last quarter. Shares yield a 1.2% dividend and trade for 28 times trailing 12-month free cash flow, a real long-term value given the multiple growth levers the company has on its hands in the decade ahead.

Taiwan Semiconductor Manufacturing: The world's largest and most advanced chip fabricator

When it comes to semiconductor giants, look no further than Taiwan Semiconductor Manufacturing (TSM). The company churned out an incredible $48 billion in sales over the last year (though it still trails behind Intel's industry-leading $78 billion in sales), and is still growing at a swift pace (Intel, not so much). 

TSM has the most advanced chip manufacturing capabilities around. Its 7- and 5-nanometer technology foundries (making the smallest, most energy-efficient designs out there) represented half of all revenue in Q2 2021. As auto technology advances and needs become increasingly complex (for EV powertrains, advanced safety and self-driving systems, in-car connectivity, etc.), TSM's automotive end-markets will grow. In fact, management chalked up last quarter's year-over-year growth of 20% to the high-end computing and automotive divisions.

Though it's handily in the lead on the chip fab front, TSM isn't resting on its laurels. The company's 4- and 3-nanometer chip foundries are on track to fire up in 2022, representing even more compact and power-efficient semiconductor designs that will eventually lead to more advanced auto capabilities -- all while eating up less battery capacity. For EV makers, increasing vehicle range on a charge is a critical part of winning the battle for consumer attention, so the auto industry certainly has a vested interest in TSM's improving prowess at building more power-efficient silicon. 

TSM stock trades at an elevated price to free cash flow metric of 65 times trailing 12-month results. In part, that's because the company is lapping last year's depressed earnings during the first round of economic lockdowns, and it's also spending at an elevated rate right now to bring extra fabrication capacity online (like a new facility in Arizona). But this metric will improve in the coming quarters as TSM steadily grows, and a dividend currently yielding 1.5% doesn't hurt. This semiconductor industry leader is flush with net cash and has a clear roadmap to further expand in the EV market and other related technologies in the decade ahead.