Micron Earnings Surprise a Huge Positive for Top Semiconductor Equipment Stocks

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MKS Instruments

This stock flies somewhat under the radar but offers solid upside. MKS Instruments Inc. (NASDAQ: MKSI) provides instruments, subsystems and process control solutions that measure, control, power, monitor and analyze critical parameters of manufacturing processes in the United States and internationally.

MKS offers pressure measurement and control products used for various pressure ranges and accuracies; materials delivery products, including gas flow measurement products and vacuum valves; automation and control products, such as automation platforms, programmable automation controllers, temperature controllers and software solutions for use in automation, I/O and distributed programmable I/O, gateways and connectivity products; and vacuum products comprising vacuum containment components, effluent management subsystems and custom stainless steel chambers, vessels and pharmaceutical process equipment hardware and housings.

Many on Wall Street have felt for some time that the increase in the Applied Material’s display equipment business will have positive implications for MKS as it supplies many key subsystems for Applied’s display tools. In addition, MKS acquired Newport recently and added the company’s iconic Spectra-Physics laser brand to its product lineup.

MKS shareholders receive just a 0.65% dividend. The $106 Stifel price target compares with the $101.57 consensus estimate. Shares closed at $92.57 on Thursday, up more than 5% on the day.

Ichor

This is another stock that may be off the radar for some, but it also could be a beneficiary from the positive news, and it is on the Stifel Select List. Ichor Holdings Ltd. (NASDAQ: ICHR) is engaged in the design, engineering and manufacturing of critical fluid delivery subsystems for semiconductor capital equipment. The company’s primary offerings include gas and chemical delivery subsystems, collectively known as fluid delivery subsystems, which are key elements of the process tools used in the manufacturing of semiconductor devices.

Ichor’s gas delivery subsystems deliver, monitor and control precise quantities of the specialized gases used in semiconductor manufacturing processes, such as etch and deposition. Its chemical delivery subsystems precisely blend and dispense the reactive liquid chemistries used in semiconductor manufacturing processes, such as chemical-mechanical planarization electroplating and cleaning.

The Stifel team has set a $28 price target. The consensus target is $26, and the shares closed on Thursday at $22.86, after climbing close to 4% on the day.

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These four outstanding stocks to buy are all way down from their 52-week highs. The recent market volatility is a legitimate concern, so it makes sense to scale-buy shares rather than go all-in. With that in mind, it is very possible that by this time next year, some serious money can be made.