5G Stock on Fire!

July 25, 2019
By Vlad Karpel

RoboStreet – July 25, 2019 

5G Stocks Leading Tech Sector Higher

The Nasdaq traded to a new all-time high this week, thrust higher by strength in the semiconductor sector where 5G technology is all the rage. The Philadelphia Semiconductor Index (SOX) rose 15% in just one week, hitting a fresh all-time high as well. Chip and chip-equipment manufacturers are racing to bring leading-edge products to end markets as spending on 5G technology is robust and expected to remain so for the next three to five years. 

The most actively traded Van Eck Vectors Semiconductor ETF (SMH) shares hit a new high this week, reflecting the massive rotation of capital into the space in just the past few months. The most recent spike higher is also very encouraging for the broader market as well, in that semiconductor stocks are historically a precursor to a resumption of economic growth, both from a domestic and international standpoint. 

This week, Nokia (NOK), Cadence Design (CDNS), Teradyne Inc. (TER), Texas Instruments (TXN) and Xilinx Inc. (XLNX) reported better-than-expected second-quarter results while highlighting accelerating demand for 5G chips and networking gear. The evidence of strong demand is translating to the strong top and bottom-line performance and Wall Street is taking notice, raising price targets left and right on 5G related stocks. 

In terms of where to expect more upside earnings surprises in the 5G space, investors need not look any further than Analog Devices Inc. (ADI). The company designs, manufactures, and markets integrated circuits (ICs), algorithms, software, and subsystems that leverage analog, mixed-signal, and digital signal processing technologies. Its products are used in numerous industries that include wireless and wireline communications, medical systems, aerospace defense, industrial electronics, automotive, factory automation systems and networking equipment. 

 “I’m investing my own money in each and every stock as my AI platform identifies.”

And remember we’re not talking about day-trading here.  I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.

Click Here – To See Where I Put My RoboInvestor Money

Within the fiscal second quarter transcript, CEO Vincent Roche commented We previously discussed our strong position in the wireless market, particularly in massive MIMO and 5G where our content opportunity is up to 4x compared to traditional 4G systems. IP traffic across carrier networks and data centers are doubling every 2.5 years, driven primarily by Cloud Compute, backhaul of 4G and 5G networks, and consumption of data-rich content. 

This extraordinary growth represents a significant challenge for the carrier networks and data centers that transport and manage this data as it’s not possible to lay new optical fiber, or double data center floor space every two years. So, their challenge is ADI’s opportunity. The communications market represented 24% of sales during the quarter and experienced very strong double-digit year-over-year growth led by ongoing strength in wireless, while our wireline franchise also continued to grow nicely. Our results this quarter reflect ADIs higher content and share in 5G.”

The stock shot higher this week in reaction to the spike in shares of Texas Instruments after TI reported earnings. Some analysts refer to Analog Devices as a mini-Texas Instruments in that they address many of the same industries. The next earnings report for Analog Devices will be released August 28, so there is time for investors to get in this hot name well ahead of when they post their fiscal Q3 numbers. 

Looking at the stock using my proprietary AI platform, shares of ADI rate very well, with three of four probability indicators posting “higher” readings going forward. The issue with the stock is that it and the rest of the 5G stocks are overbought on a short-term basis and will do some back and filling of the recent price spikes. When to buy into ADI and other 5G stocks is a pure timing issue at this point and is what my AI tools to make sure investors and traders don’t overpay for promising stocks like ADI. 

Buy stocks right affords the ability to also sell them right when that time comes to book profits. Our Tradespoon RoboInvestor stock advisory has a fantastic track record of timing the sale of stocks during periods of peak price performance. Just this past week we rang the register in shares of Coca Cola (KO), Microsoft Inc. (MSFT), Lululemon Athletica (LULU) and JP Morgan (JPM) – right as the market was flashing an overbought signal. We’ve booked 29 straight profits going back to March 22, 2019. 

In fact, of the total 79 trades we’ve closed over the course of the past year, we’ve profited on 75 of those trades for a 94.4% win rate. This simply wouldn’t be possible without the power of artificial intelligence (AI) working 24/7 to our benefit. I created the program that makes this all possible, and the really good news is that my AI system continues to learn and get smarter every day. Is it perfect? Not yet, but almost. 

I encourage all readers of this column to take a hard look at how they are managing their portfolio and honestly ask themselves if how they are currently managing their portfolio can compare or even hold a candle against these consistent results. The RoboInvestor system to stock and ETF investing is truly proven out to be a profit-making juggernaut that I’m extremely proud of. 

Don’t short-change yourself by bypassing a proven and winning system that is creating wealth more consistently than any other stock-picking model available anywhere. I’m going to be coming to market with two new picks next week that you’ll want to be in on and be an active RoboInvestor when I alert our subscribers to get long 5G stocks like Analog Devices. Become a RoboInvestor today and start profiting tomorrow! 

 “I’m investing my own money in each and every stock as my AI platform identifies.”

And remember we’re not talking about day-trading here.  I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.

Click Here – To See Where I Put My RoboInvestor Money

*Please note: RoboStreet is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services.  If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, MonthlyTrader, or RoboInvestor recommendations. If you are interested in receiving Vlad’s personal picks, please click here.

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