Nvidia<\/a>, now the world’s most valuable company, rose 1.6%. Much of last year’s rally in chip stocks was driven by Nvidia, whose \u200bgains were \u200bfueled by strong demand for its flagship graphics processing units (GPUs) that \u200bare used for tasks like training models on large \u200cdatasets.<\/p>\nEdward Jones’ Kourkafas also pointed to renewed enthusiasm for the broader tech sector, especially driven by semiconductors, after a recent dip in valuations.<\/p>\n
“Over the last 12 months, tech valuations have cheapened and have come in broadly in line with the overall market,” Kourkafas said.<\/p>\n
AI-related and other Big Tech stocks were under pressure earlier this year as investors grew uneasy over huge spending without near-term proof it would translate into faster revenue, stronger margins and higher cash flow.<\/p>\n
The S&P 500 information technology index’s price-to-earnings ratio has dropped to \u200caround 22 times its 12-month forward earnings from a peak of around \u200b31.8 last year.<\/p>\n
INVESTORS LOOK PAST NEW DEEPSEEK MODEL<\/p>\n
U.S. tech stocks also seemed \u200bto shrug off a preview of a new AI model \u200bfrom Chinese startup DeepSeek, whose low-cost AI model rocked Wall Street last year.<\/p>\n
“Over time, people have come \u200cto realize that actually they’re not the threat that \u200bthey seemed to be. The \u200bmarket’s saying, ‘Hang on, we’re not going to be bitten twice with this,'” said David Morrison, senior market analyst at Trade Nation, referring to the threat from DeepSeek.<\/p>\n
The Philadelphia chips index was last trading at around 26.6 times its 12-month \u200bforward earnings estimates, compared to around 20.7 for \u200cthe S&P 500.<\/p>\n
Analog chipmaker Texas Instruments also forecast second-quarter revenue and profit above estimates on Wednesday, sending its \u200bshares to a record high. It was last down 2.8% on Friday.<\/p>\n
(Reporting by Shashwat Chauhan and Purvi Agarwal \u200bin Bengaluru; Additional reporting by Niket Nishant; Editing by Saumyadeb Chakrabarty)<\/p>\n","protected":false},"excerpt":{"rendered":"By Shashwat Chauhan and Purvi Agarwal April 24 (Reuters) – U.S. chip stocks soared to record highs on…\n","protected":false},"author":2,"featured_media":603916,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[45],"tags":[182,262697,181,507,151286,11971,59473,4115,2085,74],"class_list":{"0":"post-603915","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-angelo-kourkafas","10":"tag-artificial-intelligence","11":"tag-artificialintelligence","12":"tag-chip-stocks","13":"tag-earnings-growth","14":"tag-edward-jones","15":"tag-intel","16":"tag-philadelphia","17":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/603915","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=603915"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/603915\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/603916"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=603915"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=603915"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=603915"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}