Advanced Micro Devices (AMD -1.81%) and Nvidia (NVDA -1.58%) are two giants in the semiconductor industry that cannot keep up with the demand for their products due to the chip shortage. Today's video focuses on recent news affecting Nvidia and AMD, current valuations for both companies, and an update on the current semiconductor shortage. Here are some highlights from the video:
- On Monday, Sept. 27, online reports appeared that Lisa Su, the CEO of AMD, believes the chip shortage will continue to be tight for the first half of 2022 but should ease up in the second half. The reasoning is that the time needed to build new manufacturing plants is roughly 18 to 24 months, and most of the investment into manufacturing plants started approximately a year ago.
- In the past 12 months, AMD and Nvidia have provided excellent returns to investors, probably due to the overall excitement of the semiconductor industry. With the current stock price correction, investors who would like to enter should think about the dollar-cost averaging method. Volatility can continue to affect the semiconductor market as yield rates increase, supply and demand change, and a market rotation to value stocks potentially continues.
- On Tuesday, Sept. 28, Micron Technologies (MU -1.17%) reported its fourth-quarter earnings. Even tech investors who don't own Micron should watch its presentation, which provides excellent insight into the upcoming quarter for the PC, data center, mobile, and automobile markets. These are markets that AMD and Nvidia provide products to.
Click the video below for my full thoughts and analysis.
*Stock prices used were the closing prices of Sept. 28, 2021. The video was published on Sept. 28, 2021.