2 Chip Stocks to Buy Instead of Nvidia Right Now
Nvidia's leadership is in question, but demand for Broadcom’s custom AI chips and Micron's memory isn't. Both stocks trade at low multiples of forward earnings.
Nvidia (NVDA) has faced a scandal involving CEO Jensen Huang, leading investors to consider alternative chip stocks. Micron (MU) and Broadcom (AVGO) are two viable options in this regard. Micron specializes in memory chips, which are in high demand due to their use in various devices, including those from AMD and Nvidia. The memory chip market shows no signs of slowing, with Micron predicting even wider supply-demand gaps in 2027 and 2028.
Meanwhile, Broadcom is designing custom AI chips for AI hyperscalers, driving significant growth in the sector. The company's AI semiconductor revenue is expected to double to $115 billion in fiscal 2027 and double again in fiscal 2028. Both Micron and Broadcom are trading at attractive prices, with Micron at 4 times forward earnings and Broadcom at 17 times forward earnings, both cheaper than the S&P 500's 19 times forward earnings.
These stocks present strong growth potential without the headline risks associated with Nvidia, making them solid alternatives for investors looking to invest outside of NVDA.
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