The cyclical nature of the chip business makes both earnings and stock prices very volatile. The group has been in a downturn for several quarters now. But because the group's bellwether, Applied Materials, has not warned of disappointing numbers in its quarterly earnings report due out next week, investors are optimistic that the company will meet estimates, said Morningstar stock analyst Jeremy Lopez. If Applied Materials does well, the other companies should, too, he said. Though there's still downside risk in all of these stocks, it's also true that if investors dally, they may miss an upturn in the sector, Lopez said.
Investors just have to be committed for a long time.
See current prices of these stocks. Compiled from staff reports, company press releases, and news services. Read Morningstar's full analyst reports on all of the stocks mentioned in this article free for 30 days. She welcomes e-mail but cannot give investment advice. Elizabeth S. Armbuster does not own shares in any of the securities mentioned above.