Semiconductor Market To Swell To $400 Billion This Year (SOXX)

semiconductor stocks

Global semiconductor sales are forecast to surge to $401.4 billion in 2017, according to the latest data from industry researchers.

Gartner notes that a shake-up is also taking place in the semiconductor world, where a longstanding top dog might soon be dethroned:

“A shortage of memory is creating a boom in the overall semiconductor market,” said Andrew Norwood, research vice president at Gartner. “Memory vendors have been able to increase their price for DRAM and NAND, driving revenue and margins higher.”

The booming memory market, with revenue forecast to increase 52 percent in 2017, is expected to shake up semiconductor market share rankings. “As the largest memory supplier, Samsung Electronics is set to gain the most,” said Mr. Norwood. “This gives Samsung its best shot at capturing the No. 1 position from Intel for the first time.”

Intel has held the top spot since way back in 1992, when it took the lead from NEC.

If it does usurp Intel, Samsung’s lead likely won’t last long, however. A flood of memory inventory is slated to hit the market over the next couple of years, and analysts expect a major memory bubble to burst by 2019.

On the ETF side of things today, the iShares PHLX Semiconductor ETF (NASDAQ:SOXX) was trading at $145.48 per share on Tuesday morning, up $0.97 (+0.67%). Year-to-date, SOXX has gained 18.55%, versus a 8.37% rise in the benchmark S&P 500 index during the same period.

SOXX currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #38 of 54 ETFs in the Technology Equities ETFs category.

SOXX is the largest semiconductor-focused ETF with over $1 billion in assets under management.