Semiconductor leaders look better placed than high-beta stocks with poor company models. TSMC, ASML, Nvidia and memory should lead the sector and belong in the buy basket, with Broadcom not far behind. The CPU basket is only a hold: much of its upside was priced in during Intel and AMD's run. x.com 

The semiconductor sector's bloat makes selectivity important. Nvidia, TSMC and ASML are among the best businesses still worth owning, but not every name will recover from this month's selloff. Chasing unprofitable, highly leveraged small caps should be a lesson from the selloff. x.com 

TSMC may lose pricing power as performance gains shift from shrinking transistors to stacking, interconnects and optics, while logic folding could make older processes competitive. Despite strong leading-edge demand, investors may overestimate the profit share its node leadership can retain. Its cautious expansion and past reluctance toward advanced packaging suggest a risk-averse culture that protects returns but could leave it late to disruptive technologies and key customers. x.com 

Low PEG ratios and continuing AI demand make leading AI stocks attractive after rolling corrections. Nvidia is at 0.39x PEG, Amazon 0.64x, Broadcom 0.66x, Micron 0.73x, Oracle 0.59x and TSMC 0.41x. This usually signals at least a local bottom, possibly a major one; midterm-year seasonality helps into year-end. Nvidia, Broadcom and Amazon remain favorites; Micron and TSMC look buyable on dips. Low PEG can mislead if growth slows or estimates are wrong. x.com 

Semiconductors could stay undersupplied for a long time as more capable AI per dollar creates more uses and drives compute demand. Micron and NVIDIA trade at low forward P/Es because investors fear peak cyclical earnings, yet current earnings show no slowdown. Shortages may worsen as AI adoption spreads, though the industry could remain cyclical; a reversal of the forced rollover trade is hoped for, not assured. x.com  x.com  x.com 

NVIDIA, Broadcom, Micron and TSMC should be worth less because AI risk has risen while the expected reward has not. The CEOs of Anthropic, OpenAI, SpaceX and Tesla have said AI risks killing all humans and needs to slow down, yet not a single analyst cut ratings or price targets on these chipmakers. In game-theory terms, higher risk with the same reward makes the bet worse. x.com 

Improving earnings and more attractive valuations favor AI infrastructure names Nvidia, Micron, Broadcom and TSMC. Goldman Sachs charts put memory stocks at about 4 times two-year forward earnings versus an 8 times median, and large fabless chip stocks at about 13 times versus 18 times. x.com 

Semiconductors will be much higher in 12 months if the market's real doubt is whether this cycle lasts another year. The cycle feels like the bottom of the third inning while the market prices a seventh-inning stretch, which is why so many chip names look like must-owns at these valuations. In order of preference: Nvidia, Credo, Astera Labs, Lumentum, Broadcom, TSMC, Coherent, Marvell, then SK hynix and Micron. x.com 

ASML has yet to fall despite losing its biggest customer, TSMC, until 2029, a customer responsible for 70% of its revenue. That disconnect reflects the current state of the chip bubble. x.com 

Semiconductor trade faces a capex growth ceiling even if AI delivers what bulls expect. Spending cannot compound at 70-100% a year indefinitely, and compute per dollar roughly doubles every two years, so the same budget buys more capacity later. Today's chip valuations also demand years of 20% AI earnings growth beyond 2028: roughly 10.9 extra years for AMD, 8.9 for ASML, 7 for Marvell and 6.4 for TSMC, versus 1.6 for Broadcom and 0.8 for Nvidia; Micron needs none under the chart's assumptions. … Show more