S&P 500 Semiconductor Equipment Stocks Surge Over 25% in 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2d ago
0mins
Source: Fool
- Industry Growth Potential: The semiconductor industry is valued between $630 billion and $680 billion in 2024, with projections rising to $1.1 trillion by 2030, while McKinsey suggests it could reach $1.5 trillion to $1.8 trillion, indicating strong demand driven by AI and data centers.
- Surge in Capital Expenditures: Taiwan Semiconductor announced plans for capital expenditures between $52 billion and $56 billion in 2026, up from $41 billion in 2025, signaling a sustained increase in demand for advanced semiconductor manufacturing equipment, which will benefit related manufacturers.
- Stock Price Rally: The capex announcement from TSMC led to significant stock price increases for four S&P 500 semiconductor equipment stocks, with Applied Materials rising 8%, Lam Research up 7%, KLA increasing by 6%, and Teradyne climbing 3%, reflecting strong market confidence in the sector.
- Investment Opportunities: As chipmakers ramp up spending on equipment, the outlook for semiconductor equipment manufacturers like Applied Materials looks promising, suggesting that if AI development continues, these stocks are poised for substantial growth in the near term, making them attractive investment options.
Analyst Views on AMAT
Wall Street analysts forecast AMAT stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for AMAT is 288.05 USD with a low forecast of 190.00 USD and a high forecast of 425.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
22 Analyst Rating
18 Buy
4 Hold
0 Sell
Strong Buy
Current: 319.460
Low
190.00
Averages
288.05
High
425.00
Current: 319.460
Low
190.00
Averages
288.05
High
425.00
About AMAT
Applied Materials, Inc. is a materials engineering solution company. The Company provides equipment, services and software to the semiconductor, display, and related industries. It operates in three segments: Semiconductor Systems, Applied Global Services (AGS), and Display. The Semiconductor systems segment designs, develops, manufactures and sells a range of primarily 300 mm equipment used to fabricate semiconductor chips, also referred to as integrated circuits (ICs). The AGS segment provides services, spares and factory automation software to customer fabrication plants globally. The AGS segment also manufactures and sells 200mm and other equipment. The Display segment is comprised primarily of products for manufacturing liquid crystal displays (LCDs), organic light-emitting diodes (OLEDs), and other display technologies for televisions, monitors, laptops, personal computers (PCs), tablets, smartphones, and other consumer-oriented devices.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
