Piper Sandler re-adjusted the ratings of several semiconductor stocks in a note Thursday, reiterating its top picks of NVIDIA (NASDAQ:NVDA), onsemi (ON), and Impinj (PI).
The firm lifted Micron Technology (NASDAQ:MU) to OW and downgraded Apple (NASDAQ:AAPL), Microchip Technology (NASDAQ:MCHP), MACOM Technology Solutions (MTSI), Qorvo (NASDAQ:QRVO), Skyworks Solutions (NASDAQ:SWKS), and Akoustis Technologies (NASDAQ:AKTS) to Neutral. Analysts at Piper Sandler said the firm is starting 2024 with a cautious stance.
"We believe that 1H24 will be challenging for the analog market, handset, and consumer end markets," analysts wrote. "However, we are expecting
the GPU accelerator and Gen AI-driven compute markets to perform remarkably well throughout calendar year 2024."
Furthermore, Piper Sandler sees a resurgence in memory driven by tightening supply coupled with improving demand.
MU's rating was lifted as the firm's primary play in memory as they believe the company's pricing momentum paired with HBM in the first half of 2024 "provides tailwinds."
On Apple, Piper Sandler has valuation concerns and sees broader handset and macro weakness, while for MCHP, auto and industrial exposure are the primary concerns.
For MTSI, Piper Sandler also noted the company's shares are near all-time highs, implying a steep valuation. For QRVO, the firm said broader handset growth is slowing, while for SWKS, there is a large customer risk. AKTS's mobile segment is set to slow, said analysts.