A Key Semiconductor Industry Metric Just Turned Ugly: Time to Sell Chip Stocks?
Semiconductors are the building blocks for much of the technology that so many sectors of the economy rely on, and semiconductor importance is only growing as industries across the whole economy incorporate an increasing number of chips into their operations to make them more efficient. Because of this, investors everywhere should pay some attention to the semiconductor industry's outlook.
One important metric governing the outlook for chips just turned negative. According to semiconductor industry advocate Semi.org, global spending on semiconductor equipment (machines and related equipment used in manufacturing electronics) is poised for a steep decline in 2023. Does this mean it's time to sell top stocks like ASML (NASDAQ: ASML), Applied Materials (NASDAQ: AMAT), and Lam Research (NASDAQ: LRCX)?
Back in December, Semi.org predicted total semiconductor equipment sales would increase to $108.5 billion in 2022, up from $102.5 billion in 2021 and mark the third straight year of growth. With the chip shortage in full effect through most of 2022, most chip fabs (the facilities that make chips) were fully booked and trying to increase capacity to meet their customer demands.
Source Fool.com
