3 Chip Stocks Generate Bullish Signals with Confidence Level over 85%
December 30 was a ho-hum day for the market as many investors were on the sidelines during the holiday season. Despite the low trading volume and lack of excitement, there were three different semiconductor companies that saw bullish signals generated by Tickeron’s A.I.dvisor. That is the company’s artificial intelligence tool. The signals all three showed very high confidence levels for a move higher in the next month.
Microchip Technology (MCHP), Texas Instruments (TXN), and Xilinx (XLNX) all saw bullish signals generated on December 30 and the signals showed confidence levels of 88% and 89%.
All three stocks have seen big gains since the March low, but all three have also experienced small downturns in the last few weeks.
Digging deeper in to the companies and their fundamentals, the Tickeron Fundamental Analysis Screener shows a number of positive signs for all three. In fact, all three have four positive indicators. Texas Instruments doesn’t have any negative marks, Xilinx has one, and Microchip has two.
There are two areas where all three companies get positive signals, the Valuation Ratings and the Profit vs. Risk Rating. Texas Instruments gets extremely high marks in both areas and it gets an extremely high mark for its SMR Rating. Xilinx also gets a good score for its SMR Rating while Microchip’s SMR Rating is neutral.
Microchip and Texas Instruments both score well for their Price Growth Rating while Xilinx gets a neutral rating. One indicator that is mixed is the PE Growth Rating. Xilinx gets a positive mark, Texas Instruments gets a neutral score, and Microchip gets a negative reading.
The stocks don’t fare as well in the technical analysis screener, but some of the readings are getting a little old. All three stocks did get bullish signals from the Aroon Indicator within the last 10 days. All three also got bullish signals from the moving average indicator 22 days ago. All three got bearish signals from the Bollinger Bands 17 days ago and 21 days ago, right before the previously mentioned pullbacks.
Texas Instruments received a bullish signal from the Stochastic Indicators eight days ago. Both Microchip and Texas Instruments are oversold at this time based on the stochastic indicators. All three stocks saw their stochastic indicators make bullish crossovers on December 30.
Xilinx is set to be acquired by Advanced Micro Devices (AMD) in an all stock deal, so the price of Xilinx is highly correlated to the price of AMD at this time. It is worth noting that AMD also saw its stochastic indicators make a bullish crossover on December 30.
TXN sees its Stochastic Oscillator climbs out of oversold territory
On December 23, 2024, the Stochastic Oscillator for TXN moved out of oversold territory and this could be a bullish sign for the stock. Traders may want to buy the stock or buy call options. Tickeron's A.I.dvisor looked at 57 instances where the indicator left the oversold zone. In of the 57 cases the stock moved higher in the following days. This puts the odds of a move higher at over .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where TXN's RSI Indicator exited the oversold zone, of 17 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on December 24, 2024. You may want to consider a long position or call options on TXN as a result. In of 104 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for TXN just turned positive on December 24, 2024. Looking at past instances where TXN's MACD turned positive, the stock continued to rise in of 45 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where TXN advanced for three days, in of 296 cases, the price rose further within the following month. The odds of a continued upward trend are .
TXN may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
TXN moved below its 50-day moving average on November 19, 2024 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for TXN crossed bearishly below the 50-day moving average on November 25, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 17 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TXN declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for TXN entered a downward trend on December 24, 2024. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 67, placing this stock better than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (10.163) is normal, around the industry mean (11.467). P/E Ratio (35.770) is within average values for comparable stocks, (57.657). Projected Growth (PEG Ratio) (3.087) is also within normal values, averaging (3.177). Dividend Yield (0.027) settles around the average of (0.021) among similar stocks. P/S Ratio (11.249) is also within normal values, averaging (54.092).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. TXN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
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a manufacturer of integrated circuit semiconductors and calculators
Industry Semiconductors