Governments around the world are pouring money into the semiconductor industry to boost production and meet the surging demand from a variety of industries. Therefore, both Advanced Micro Devices (NASDAQ:AMD) and ASE Technology (ASX) should benefit. But which of these stocks is a better buy now?.Advanced Micro Devices, Inc. (AMD) and ASE Technology Holding Co., Ltd. (NYSE:ASX) are two prominent players in the semiconductor industry. AMD offers microprocessors, chipsets, GPUs, server and embedded processors, semi-custom System-on-Chip (SoC) products, technology for game consoles, and provides assembly, testing, and packaging services worldwide. In comparison, Taiwan-based ASX provides a range of semiconductors packaging and testing and electronic manufacturing services internationally. It offers IC wire bonding packages, system-in-package products (SiP) and modules, interconnect materials, and assembles automotive electronic products.
Despite the global supply crunch, the semiconductor industry has witnessed 29.7% year-over-year sales growth in August 2021. Since Malaysia, the home to suppliers and factories serving semiconductor makers, has started its production with almost 80% capacity in September, and governments worldwide are investing to boost semiconductor production, the global chip shortage is expected to ease. The global semiconductor market is expected to grow at a 7.7% CAGR to $778 billion by 2026. So, both AMD and ASX should benefit.
While ASX has lost 12.29% over the past three months, AMD has surged 17.57%. Which of these stocks is a better pick now? Let’s find out.