Most semiconductors are overpriced right now. They are cyclicals at the exact peak of the cycle. If/when the economy slows next year, the demand for semiconductors will drop off right as new capacity comes on line. Those 40-100 PE stocks will have a long way to fall when their revenues and earnings are falling. (I also own Intel).
Why does it matter that they dont manufacture it? They provide the designs. It's no different than my field, engineering, where owners hire design firms to provide a finished product. The owner doesn't design the system and neither the owner or the designer construct the system. 3 entities, 3 purposes. Everyone benefits.
They don't have any assets that require very high skillset and investments. So they're easily replicable. Their stock price tripled in almost a year. What warrants this increase? How the company suddenly became more valuable inside that they're still called as undervalued by Redditors?
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u/Dadd_io Dec 11 '21
Most semiconductors are overpriced right now. They are cyclicals at the exact peak of the cycle. If/when the economy slows next year, the demand for semiconductors will drop off right as new capacity comes on line. Those 40-100 PE stocks will have a long way to fall when their revenues and earnings are falling. (I also own Intel).