Technology stocks soared in 2024. The technology field may have stopped in recent weeks, but Nasdaq Composite Materials (NasdaqIndex: ^i tocie) Market indexes are still hovering below the record highs reached in December.
However, the stock price surge has not reached every corner of the technology market. Several legendary industry leaders are being slashed with the 52-week peak at a significant discount. Continue reading to learn why you should look at semiconductor veterans more deeply Micron technology (Name: MU) and Intel (NASDAQ:INTC) Now.
Micron has benefited greatly from the boom of artificial intelligence (AI). In particular, systems used to train or operate generating AI tools require a lot of memory.
This is true even for DeepSeek, which is known for its low hardware expenses. AI accelerator cards running the latest DeepSeek V3 version require high-speed video memory (VRAM) over 1.5 tons (TB). Lighter models can be managed from powerful laptops, but even the low-quality DeepSeek V2 236B must have over half the video memory. This is difficult in a single system, especially for laptops. Today's largest laptop RAM module is available in 48 gigabytes (GB), while the server can get digital hands on a 256 GB card.
This is a resource-based generation AI system. More ambitious models, such as Openai's Chatgpt, use orders of magnitude, more processing power and memory. These big iron solutions have not disappeared. Remember that the lighter DeepSeek system may be simply because it can take advantage of the work done by a more powerful solution.
As a result, Micron's stock fell along with AI accelerator designers Nvidia (NASDAQ: NVDA) When DeepSeek landed on the world stage in January. In fact, Micron's stock is deeper than Nvidia's. Stocks can be undervalued forward DeepSeek Discount.
Today, the stock is estimated to be only 9 times higher, according to Finviz. These estimates are 50% higher than the current earnings run rate, while microscopic trades in multiples of 13 times. Given that management expects “substantive revenue records” and better profitability in the just-start fiscal 2025, this seems like a reasonable assumption.
In the latest earnings report, sales increased by 84% year-on-year, while the bottom line shifted from a strong loss to a reliable net profit. Micron is expected to see strong growth in 2025, and stock prices have not yet reflected this bullish reality.
Intel is another story. Semiconductor veterans are undergoing many changes that have lost market share to long-term competitors Nvidia and Advanced Micro Devices (NASDAQ: AMD)and run expensive strategy shifts under temporary management teams. This is a lot even for world-class innovators with deep pockets.
But Intel is not as ill as its stock chart suggests. Intel's shares trade only above book value, a valuation that is usually reserved for companies on the verge of bankruptcy. But Intel has nothing. It remains a market leader in server and PC system processors, not to mention its respectable AI accelerator line. Over the next four to five years, its strategic shift should lead to world-class manufacturing foundries located primarily on U.S. soil.
That's a promising position. Taiwan Semiconductor Manufacturing (NYSE: TSM) is the global leader in the industry today. Its stock is nearly 8 times worth. I'm not saying Intel will match that valuation ratio in a few years, but of course it's worth a higher bargaining figure than the bargaining ratio you've got today.
Yes, many things need to be right when Intel explores a completely different strategy. Much of the company's future success depends on finding the right CEO for the ongoing sharp strategic shift. That being said, the industry legend of Intel teaching capabilities should effortlessly find top management talents. Who wouldn't want to be called the leader, who turned Intel's fate and created an unparalleled American chip factory?
So Intel is a risky bet, but I'm happy to make it at the stock price of this rock. Actually, I bought more Intel stock a few weeks ago but still interested in snapping up more.
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Anders Bylund has positions in Intel, Micron Technology and Nvidia. Motley Fool has a location and recommends advanced micro-equipment, Intel, Nvidia and Taiwanese semiconductor manufacturing. Motley Fool recommends the following options: A brief $27 Intel phone for February 2025. Motley Fool has a disclosure policy.
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