Semis Corrected: What Are You Waiting For?

So many of you clamored to own $NVDA and $ASML and all of the other great semiconductor stocks during the run into record highs. Over the past week the SOXX fell by a staggering 10% and now many are reticent to step in and buy the dip. This is the nature of most traders, trend followers to their core, unable to based their investments on any fundamentals due to the recent popularity of technical trading.

A look at the carnage in the semis the past week:

$ASML -17.9%
$MU -14.5%
$RMBS -12.2%
$SGH -17.3%
$ENTG -11.8%
$AMAT -14%
$LRCX -14.5%
$MKSI -12.7%
$NVDA -9%
$TSM -11.5%
$AMD -16.5%

So is everything cheap now?

That’s the median price to sales ratio for the second largest semi subsector, presently trading at a 60% premium to last year. Moreover, if the semis were to once again attain a p/s of 3.79 we’d need another 37% drop in the sector and if to attain the 2.9 average dating back to 2008, we’d need a 53% courrection from Friday’s close.

But what about AI and what about Bitcoin?

Contrary to popular belief, the growth in the semis is really isolated in $NVDA and Nvidia alone. No other major semi has enjoyed the growth that is being seen in $NVDA and they’re all just riding off its coattails at this point.

Happy Hunting!