3 Chip Stocks For Tech Investors To Buy Now For Coronavirus Rally And Beyond

All three major U.S. indexes jumped over 2% through morning trading yesterday on better-than-expected May retail sales. Alongside another sign that the U.S. economy is in coronavirus recovery mode, the Fed on Monday laid out its previously announced plans to buy U.S. corporate bonds and reports surfaced that the Trump administration is considering a $1 trillion infrastructure plan to help boost the economy.

May U.S. retail sales surged roughly 18% from April, according to Commerce Department data, to crush projections of economists surveyed by The Wall Street Journal who called for a 7.7% bounce. The climb represented the largest monthly increase on record, dating back to 1992. The numbers also highlighted that the pandemic’s worst economic days are likely behind us, with retail sales from non-essential segments such as furniture up big.  

Despite the positivity, stocks suffered some big losses last Thursday on fears about spikes in coronavirus cases. That said, there was always going to an increase in cases as economies around the world reopen because the virus didn’t disappear.

Plus, the big-one day drop might simply have been a chance for investors to take home some profits, as it came just days after the Nasdaq hit new highs, driven by Amazon (AMZN - Free Report), Apple (AAPL - Free Report), Microsoft (MSFT - Free Report), and others, and the S&P 500 broke into positive territory for 2020 and remains up 36% from its March 23 lows.

Volatility could rear its head again, but investors might still want to buy stocks. This means they should hunt for stocks with solid fundamentals within growth-focused industries. With this in mind, let’s dive into three semiconductor stocks that investors might want to buy both for the coronavirus rally and longer-term growth…

Marvell Technology (MRVL - Free Report)

Marvell offers semiconductor solutions for storage, processing, networking, security, and connectivity. MRVL topped our Q1 FY21 estimates at the end of May, with revenue up roughly 5%. Marvell’s Q1 sales were driven by “stronger demand” for its “networking products from the datacenter and 5G infrastructure end markets.” CEO Matt Murphy said in prepared remarks that while it did “experience some COVID-19 supply chain impacts on our storage business in the first quarter, we expect a bounce back in the second quarter and we project our networking business to continue to grow.”

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Jeremy Schmeltz 5 months ago Member's comment

Really good article, very informative and the author really points the reader in the right direction when considering buying technology stocks. I can't wait to see how these stocks perform in the coming weeks.

Dan Nicholson 5 months ago Member's comment

Agreed.