Semiconductor demand is set to take off thanks to the growing application of chips across a wide range of verticals, including automotive, industrial, technology, healthcare, and other sectors. According to a third-party estimate, the global semiconductor market’s revenue could hit $803 billion by 2028 compared to an estimated $452 billion this year, clocking a compound annual growth rate of 8.6%. For comparison, the global semiconductor market was touted to grow at just 2.9% a year between 2015 and 2020.

The improving prospects of the semiconductor market bode well for the likes of Analog Devices (NASDAQ:ADI), Synaptics (NASDAQ:SYNA), and Broadcom (NASDAQ:AVGO) — three stocks that have tripled in price the past five years.

The improving prospects of the semiconductor market bode well for the likes of Analog Devices (NASDAQ:ADI), Synaptics (NASDAQ:SYNA), and Broadcom (NASDAQ:AVGO) — three stocks that have tripled in price the past five years.

ADI DATA BY YCHARTS

It wouldn’t be surprising to see these stocks repeat their performance in the future thanks to the improving prospects of the semiconductor market. Let’s look at the reasons why you should be buying these stocks right now.

1. Analog Devices

Analog Devices’ chips are used in the industrial, communications, automotive, and consumer end markets, and almost all of them are in fine form.

Analog’s total revenue shot up 26% year over year in Q2 to $1.66 billion after a 20% jump in Q1. The chipmaker registered terrific growth in the industrial and automotive businesses, which grew 36% and 42% year over year, respectively. These businesses accounted for 74% of Analog’s total revenue last quarter, with industrial being its largest source of revenue, producing nearly 59% of its top line.

The automotive and industrial markets are going to… Continue reading at The Motley Fool