Equity Research

Initiate on US Semi Cap Equipment, Storage, and Foundry - Buy LRCX, AMAT, STX, SNDK; Sell TER, MKSI

We initiate on the US Semiconductor Capital Equipment, Storage, and Foundry sectors (12 companies) with a balanced view given the mid-cycle dynamics we see. We believe the Semiconductor Capital Equipment industry is in a mid-cycle state, with both headwinds and tailwinds creating relatively stable revenue dynamics across the sector. On one hand, the market outside China has been in a clear, shallow downcycle since 2022; China has kept the Semi Cap sector in a slow-growth mode over this period. Although we see more downside than upside risks, we think “stable” revenue through 2026 is the most likely outcome.

  In numbers

Initiate on Analog and RF Semiconductors: Buy MCHP, NXPI, TXN, ADI; Sell SWKS

We initiate on the US Analog & RF Semiconductor sector (7 companies), with a relatively bullish view given the cyclical opportunities we see. The analog semiconductor industry is in a state of deep cyclical correction. The "mother of all analog upturns" began during COVID, driven by a combination of acute supply shortages and exaggerated demand for all capital goods, most notably electric vehicles. The rationale for this upturn ("just in case" supply chains and re-shoring of manufacturing) drove inventory levels higher — thus exacerbating the current downturn. 

  In numbers

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10 Jul 2025 | Research | Equity - James Schneider, Ph.D. and others

James Schneider, Ph.D.
Americas Semiconductor & IT Services | New York