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Worldwide sales of semiconductors climbed to a record $80.92 billion in the third quarter of 2013, up 8.4% from $74.64 billion in the prior quarter, according to the Semiconductor Industry Association (SIA). Chip sales for September grew 3.3% month on month and 8.7% year on year to $26.97 billion, also hitting a record level. That is great news for some companies, but others may not be so fortunate.

SIA president and CEO Brian Toohey said in a statement:

The global semiconductor industry has built impressive momentum through the third quarter of the year and is well-positioned for a strong close to 2013, thanks largely to growing strength in the Americas. The industry established new monthly and quarterly bests in September, and favorable trend lines indicate continued growth.

Despite all of this positive news, the chip analysts at J.P. Morgan are stressing caution. They also are advising clients to avoid the stocks with a large personal computer exposure. The team believes investors should focus on companies with margin leverage and exposure to the strongest end markets. Those are communications, industrial and automotive.

Here are the four top names to buy in the areas gaining the most traction. J.P. Morgan also has some names to avoid.

Analog Devices Inc. (NYSE: ADI) fits the bill for companies that the J.P. Morgan team suggests to own. Acknowledged industrywide as the world leader in data conversion and signal conditioning technology, Analog Devices serves more than 60,000 customers, representing virtually all types of electronic equipment. Investors are paid a 2.7% dividend. The J.P. Morgan price objective for the stock is $51. The Thomson/First Call target is at $49.60. The stock closed Thursday at $49.14.

ON Semiconductor Corp. (NASDAQ: ONNN) is a smaller cap name that may bring big returns for investors. The company offers a comprehensive portfolio of energy efficient power and signal management, logic, discrete and custom solutions to help customers solve their unique design challenges in automotive, communications, computing, consumer, industrial, LED lighting, medical, military/aerospace and power supply applications. The J.P. Morgan price target is set at $10, but the consensus is lower at $8.80. The stock closed Thursday at $7.11. A move to the target would represent a 40% gain for investors.

Texas Instruments Inc. (NASDAQ: TXN) is an old line company that J.P. Morgan thinks has solid business prospects. The company has a broad range of power management and analog signal chain products that offer design engineers the high performance, low power and integration they need to create innovative and differentiated consumer electronics. Investors are paid a good 2.9% dividend. J.P. Morgan has a $42 price target for the venerable company. The consensus estimate is at $40, though Texas Instruments closed Thursday at $41.65.

Xilinx Inc. (NASDAQ: XLNX) rounds out the top four names to buy at J.P. Morgan. The company’s programmable devices comprise integrated circuits (ICs) in the form of programmable logic devices (PLDs), such as programmable System on Chips, and three dimensional ICs; software design tools to program the PLDs; targeted reference designs; printed circuit boards; and intellectual property (IP), which consists of Xilinx and various third-party verification and IP cores. The J.P. Morgan target for the stock is $49, while the consensus is placed at $48. Xilinx closed Thursday at $44.49.

The J.P. Morgan analysts are very negative on companies leveraged to the personal computer and other slow-growth chip businesses. They have Underweight ratings, or the equivalent of Sell ratings, on Cypress Semiconductor Corp. (NASDAQ: CY), Linear Technology Corp. (NASDAQ: LLTC) and R.F. Micro Devices Inc. (NASDAQ: RFMD).

They have Neutral ratings on Avago Technologies Ltd. (NASDAQ: AVGO) and Intel Corp. (NASDAQ: INTC). With posted price targets for these stocks of $32 and $20, respectively, investors may want to consider a pair trade. Avago closed Thursday at $43.66 and Intel at $24.06.

Investors that look in the right sectors of the chip business could post some extremely strong gains. Staying away from the slow-growth areas, while focusing on communications, industrial and automotive, may be just the ticket for 2014.