This article first appeared on GuruFocus.
Morgan Stanley named Nvidia (NASDAQ:NVDA), Broadcom (NASDAQ:AVGO) and Astera Labs (NASDAQ:ALAB) as its top semiconductor picks for 2026, pointing to strong AI-driven demand in data center chips, according to a recent research note.
The firm highlighted Nvidia and Broadcom as its preferred processor names. Analysts said Nvidia could deliver the highest returns in cloud computing as Vera Rubin deployments ramp in the second half of 2026. Broadcom remains central to AI infrastructure, despite potential bottlenecks in ASIC growth.
Astera Labs emerged as the standout small-cap pick for data center opportunities. Morgan Stanley kept Equal-Weight ratings on AMD (NASDAQ:AMD) and Marvell (NASDAQ:MRVL), noting room for upside but also some uncertainties. Intel (NASDAQ:INTC) drew a cautious view due to challenges in its foundry operations.
In memory and chip equipment, Micron (NASDAQ:MU) leads the way, with Sandisk (NASDAQ:SNDK) also rated Overweight. Applied Materials (AMAT) and Taiwan Semiconductor (NYSE:TSM) are favored in equipment, while NXP Semiconductors (NXPI) balances growth and value. Analog Devices (ADI) shows growth potential, though at a higher price point.