Ticker Reports for February 11th
3 Chip Stocks Still Trading 50% Below Their 52-Week Highs
The semiconductor industry has become an intense area of focus in the stock market over the past few years. It's always been important, but the advent of artificial intelligence is driving unprecedented interest. Since the beginning of 2023, companies like NVIDIA (NASDAQ: NVDA) and Broadcom (NASDAQ: AVGO) have emerged as massive winners in the space. The stocks are up over 800% and over 300%, respectively, over that time, as of the Feb. 10 close. They are far from the only winners, but the two stocks stand out. Their ability to continue rising somewhat steadily is an indication of their persistent strength to this point.
The three stocks detailed on this list have had their days in the sun but haven’t exhibited anywhere near the consistency of NVIDIA and Broadcom. Below, I’ll examine three giant names in the semiconductor industry that are still trading 50% or more below their 52-week highs. I’ll provide context around each of their individual journeys and give insight into how they can hope to reclaim their prior glory.
AMD: NVIDIA's Successful, But Still Disappointing, Little Brother
In the world of semiconductor stocks, some tides lift all boats, while others create winner-take-all situations. Both of these ideas somewhat characterize the recent journey of Advanced Micro Devices (NASDAQ: AMD). The stock has an impressive return of 70% since Jan. 1, 2023. However, it is still trading 51% below its 52-week high, reached on Mar. 8, 2024. The company is working to compete against NVIDIA. It wants to build graphics processing units (GPUs) and associated systems for data centers that can rake in cash as fast as its fierce rival.
Ultimately, markets have largely judged the stock by its ability to show any progress in taking market share from NVIDIA in this space. AMD’s data center revenue is growing fast, increasing by 69% in Q4 2024 versus Q4 2023. However, it's not on pace with NVIDIA. In Q3, NVIDIA’s data center revenue increased by 112%. NVIDIA's lead keeps growing. Note that these numbers aren't fully comparable since NVIDIA hasn't yet released the Q4 results. Ultimately, the market wants to see AMD achieve stronger growth for its AI Instinct GPUs and continue increasing profit margins, which are still massively below NVIDIA’s.
Intel: Needs Innovative New CEO to Come to the Rescue
Once the most important player in the U.S. semiconductor industry, Intel (NASDAQ: INTC) has been a huge disappointment recently. Since the beginning of 2023, shares have provided a total return of -22%. Its shares are currently down nearly 58% from their 52-week high. The company is an integrated device manufacturer. This means that it not only designs but also manufactures its chips. The company missed the boat on designing GPUs that would largely power the rise of AI in data centers. The company’s AI data center GPU chip, Gaudi, hasn’t come close to meeting expectations. Overall, the firm’s data center revenue dropped slightly year-over-year in Q4, while margins plummeted.
The best hope for the company going forward might be winning in the AI-enabled PC market. The company’s Client Computing Group segment is by far its largest revenue and profit driver. A refresh cycle in PCs that many are hoping for would be a boon to Intel. Most people agree that the company needs a new CEO, as it requires a new vision for how it will grow.
Supermicro: All Eyes on Feb. 11 Update
Super Micro Computer (NASDAQ: SMCI) has by far seen the most wild swings of all three of these firms. Shares are up over 400% since Jan. 2023. However, they are still down 65% from the incredible highs they reached back in Q1 2024. But, they are up 40% year to date in 2025. The rally started on Feb. 3, kicked off by the company announcing it would provide a business update on Feb. 11. The firm’s shares have gotten crushed as they delayed filings and its accounting auditor resigned. The company also announced that it is ramping up full production of its rack-scale solutions for NVIDIA’s Blackwell chips.
Ultimately, the company needs to address concerns about its accounting practices in the update. It also needs to convince investors that it is close to completing its filing of its Form 10-K and that it will do so by Feb. 25. The company’s revenue growth of over 143% in Q2 2024 is incredibly impressive. Even if it is accurate, the company needs to be forthcoming and fix its internal problems to be investable going forward.
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3 Stocks to Gain From the Rising Demand in Offshore Drilling
President Trump’s “Drill, baby, drill” initiatives may cause a demand spike for offshore drillers. Trump signed an executive order attempting to remove former President Biden’s permanent offshore drilling ban over 625 million acres of federal waters. This includes the Eastern Gulf of Mexico, the Pacific coasts of Oregon, California, Washington, the Atlantic Coast, and Alaska’s Bering Sea. Trump plans to expedite the approval of permits to drill on federal lands in an effort to increase domestic oil production and bring energy prices down. Here are three drillers in the oils/energy sector that could benefit from the rising demand for offshore drilling.
Transocean: Leading Offshore Drilling Contractor Fleet Utilization Nearly Full
Transocean Ltd (NYSE: RIG) provides offshore contract drilling services for the oil and gas industry.
They have a fleet of 34 mobile offshore drilling units, which consist of 26 ultra-deepwater floaters and eight harsh environment floaters.
Over 80% of Transocean’s rigs are less than 10 years old, with 10 delivered within the last five years.
Max water depth ranges from 7,500 to 12,000 feet, and max drilling depth ranges from 30,000 to 40,000 feet.
Demand Drives Up Day Rates
The company charges day rates for their drilling rigs. More demand equates to higher day rates. For example, BP secured a 365-day contract for the Deepwater Atlas drillship set to start in Q2 2028 at a day rate of $635,000 or $232 million per year. This comes after an earlier contract for the Atlas for a four-well contract at $505,000 a day and a two-well contract for $580,000 a day.
Rising Day Rates and Utilization Results in a 33% YoY Revenue Bump
Transocean reported Q3 2024 EPS of 7 cents, beating consensus estimates by 11 cents. Revenues rose nearly 33% YoY to $948 million, matching consensus estimates. Contract drilling revenues rose sequentially by 87 million due to increased rig utilization, higher day rates for two rigs, higher reimbursement revenues, and a full quarter of revenues from the newbuild ultra-deepwater drillship Deepwater Aquila, which was partially offset by lower revenue efficiency across its fleet.
Over 97% of Transocean’s Rigs Are Booked for 2025
Transocean’s backlog booked an additional $1.3 billion in Q3, including the Deepwater Conqueror, bringing the total backlog to $9.3 billion with clear visibility of future demand. The demand for ultra-deepwater and harsh environment rigs remains strong. CEO Jeremy Thigpen stated, “With these most recent awards, more than 97% of Transocean’s active fleet is contracted in 2025, once again demonstrating that our customers clearly recognize Transocean’s unique capabilities – our rigs, crews, and superior operational performance –add value to their programs.”
Valaris: Operating the World’s Largest Fleet of Oil Rigs
Valaris Ltd. (NYSE: VAL) provides contract offshore drilling services just like Transocean.
The difference is that Valaris operates a larger fleet of 53 rigs, which include drillships, jack-up rigs, and semi-submersible platform drilling rigs.
Jack-up rigs, also known as mobile offshore drilling units (MODU), are giant rigs with legs and a large mobile platform that looks like a city on the sea.
Workers will often sleep there for two to three weeks at a time in the living quarters that are usually outfitted with a gym, cafeteria, sauna, TV, and computer rooms.
Upbeat About the Upcycle Runway Through 2026
Valaris reported Q3 2024 EPS of 8 cents, missing analyst estimates by 19 cents. Revenues rose 41% YoY to $643 million, beating consensus estimates by nearly $23 million. Fleetwide revenue efficiency was 98%, which included a full quarter of operations for its VALARIS DS-7, which started its contract in Q2.
Valaris Leadership Remains Confident in Industry Upswing
Management remains very confident in the upswing. CEO Officer Anton Dibowitz stated, “We maintain our conviction in the strength and duration of this upcycle and believe Valaris is well positioned to drive long-term value creation. While we have seen some customer demand deferred, the outlook for 2026 and beyond remains robust. We continue to focus on securing attractive, long-term work for our available rig fleet to support our earnings and cash flow growth."
Seadrill: A Smaller Fleet Trying to Right the Ship
Seadrill Ltd. (NYSE: SDRL) also provides contract offshore drilling services to the oil and gas industry.
Seadrill claims to have the most modern fleet of all the major offshore drillers, from drillships, jack-ups, and semi-submersibles for benign and harsh environments.
They have a fleet of 13 ultra-deepwater drillships, four submersibles, and five shallow-water jack-ups.
In October 2024, Bloomberg reported that Transocean and Seadrill were in ongoing merger discussions, but the rumor fizzled out.
Seadrill Delivers Surprise EPS Beat Despite Revenue Decline
Seadrill reported Q3 2024 EPS of 49 cents, beating consensus estimates by 47 cents. Revenues fell 14.5% YoY to $354 million but still beat consensus estimates by $32 million. Its Q3 performance was better than it expected internally, which led it to raise its forward guidance for the full year 2024 revenues of $1.39 to $1.41 billion versus $1.36 billion consensus analyst estimates.
Seadrill’s Optimistic Long-Term View Supports Investor Confidence
Seadrill CEO Simon Johnson commented, “Seadrill's third-quarter results exceeded expectations, leading us to raise our full-year guidance. We secured additional drilling work for the Sevan Louisiana and mobilized the West Auriga and West Polaris to Brazil, where they are undergoing customer and regulatory acceptance.”
However, Johnson also pointed out, “In the absence of an immediate market opportunity for the West Phoenix, we stacked the rig and released the crews, refusing to contribute to our own white space, waiting on the market to change.” He concluded, “Despite the near-term imbalance between available rigs and opportunities, we remain resolute in our belief in the strength and durability of the offshore drilling industry and Seadrill’s position within it.”
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Buy NVDA Now?
After weeks of volatility, did President Trump just turn Nvidia (NVDA) into a raging BUY?
The beloved chipmaker has struggled this year, facing increased competition and regulatory pressure.
3 Construction Stocks Set to Surge on Tariff-Driven Demand
There has been a new wave of volatility in the stock market lately, this time due to President Trump's rollout of trade tariffs. This economic uncertainty has led investors to shift their portfolios, seeking safety and additional upside for the coming months. However, it is easy to get lost in the weeds and complicate a process that should be kept as simple as possible.
With this in mind, investors can look to the way most professionals in the industry come up with their winning ideas: through data. Recent trends in the labor market and the PMI indexes show that the construction sector is about to expand after contracting for a few consecutive quarters. However, not all construction stocks are made equal.
That is because, as investors will see shortly, it is not residential construction that will be in play but infrastructure building materials. This is where stocks like Martin Marietta Materials Inc. (NYSE: MLM), Vulcan Materials (NYSE: VMC), and even Ternium (NYSE: TX) come into play to give investors some of the best plays in the industry today.
More Room to Run for Martin Marietta Stock
Even though this name has reached 91% of its 52-week high today, there are factors left in it that make Wall Street analysts think it has more room to run higher. Investors can see this theme at play through the $648.7 consensus price target placed on it, which calls for a new 52-week high and a 20.5% upside from today’s price.
This view is based on the fact that the construction sector, as quoted in the latest services PMI index, is seeing a boost in demand for American energy infrastructure projects. This directly connects with President Trump’s plan to bring back domestic energy production and may explain why Warren Buffett is also investing in the energy sector.
Knowing that the tailwinds in this name are building on themselves, short sellers have decided that the risk-to-reward is not worth the fight. So, over the past month alone, investors would have noticed a net decline of 5.6% in Martin Marietta’s short interest, a clear sign of bearish capitulation in the face of all these bullish factors.
A Justified Premium for Vulcan Materials
Some value investors argue that high valuation multiples make a stock risky to buy, as the downside could be much greater than the upside left in it. However, seasoned traders and investors will remind them that the market is always willing to pay a premium for the names it believes will outperform the industry and the broader market.
Understanding this market truth, investors should pay attention to Vulcan Material’s current 43.0x price-to-earnings (P/E) ratio, which is a steep premium to the rest of the construction sector’s average valuation of only 24.0x P/E. Now, why would the market bring this stock up to that high of a premium?
The reason is that it is a vital player in infrastructure construction materials, the very same ones that could see a boost in demand soon. Considering that earnings season is in full swing now, investors could expect to hear some positive guidance from management for these companies.
It shouldn’t come as a surprise for investors to see Stephens analysts reiterating an Overweight rating. As of January 2025, Vulcan Materials stock was valued at a high of $325 per share. Again, this valuation calls for a new 52-week high for the stock and a 19% additional upside from today’s level.
Limited Downside, Lots of Upside in Ternium Stock
This Brazilian steelmaker is a very interesting play for investors to consider today, especially as it trades down to only 67% of its 52-week high. The reason is that it serves both the United States and the Chinese markets, two countries that are now looking to expand their infrastructure construction and spending.
Trading this low gives both investors and analysts confidence to see a higher price for this stock as a potential scenario, of course. One that is capped on the downside to provide a fantastic risk-to-reward ratio in today’s volatile market environment. The question is, how much upside can be expected?
With a $47.50 consensus price target for this name, investors can expect a net 58.6% upside in Ternium stock to make it the most optimistic out of today’s list, but one that also comes with an added bonus. Management’s confidence in the future of this company’s cash flows has enabled it to pay up to $1.80 per share in dividends.
At today’s price, that payment would translate into an annualized yield of up to 6% to beat inflation rates and also cushion any further volatility that might come from today’s tariff environment.
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Before you make your next trade, you'll want to hear this.
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Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list.
They believe these five stocks are the five best companies for investors to buy now...
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