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SVTPerformance's Chain of Restaurants
Road Side Pub
Frying Pan Into the Fire -- Chip Shortage
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<blockquote data-quote="Weather Man" data-source="post: 16598764" data-attributes="member: 137766"><p><a href="https://seekingalpha.com/news/3677001-chip-shortage-rages-on-but-reshoring-opportunities-are-growing" target="_blank">Chip shortage rages on, but reshoring opportunities are growing: Alpha Tactics</a></p><ul> <li data-xf-list-type="ul">The semiconductor shortage continues to impact different segments of the market.</li> <li data-xf-list-type="ul">On Friday, Nio temporarily suspended vehicle production at the JAC-NIO manufacturing plant in Hefei for <a href="https://seekingalpha.com/news/3676661-nio-halts-production-lowers-vehicle-delivery-outlook" target="_blank">five days due to lack of chips</a>.</li> <li data-xf-list-type="ul">And Stellantis said it would temporarily <a href="https://seekingalpha.com/news/3676971-stellantis-to-temporarily-close-five-north-american-plants" target="_blank">close five North American plants</a>.</li> <li data-xf-list-type="ul">The chip shortage was largely due to spiking pandemic-related demand for notebooks, smartphones, game consoles and other consumer electronics. And the auto industry cut orders for chips when demand plunged at the start of lockdowns and <a href="https://seekingalpha.com/news/3659294-auto-chip-shortage-driving-61b-in-lost-sales-faces-complicated-recovery" target="_blank">lost their already low priority at semiconductor foundries</a>.</li> <li data-xf-list-type="ul">Semi equipment makers <a href="https://seekingalpha.com/news/3676818-auto-chip-shortage-worsens-after-blackouts-and-fire-sending-semi-suppliers-higher" target="_blank">gained this past week</a>, with Applied Materials (NASDAQ:<a href="https://seekingalpha.com/symbol/AMAT" target="_blank">AMAT</a>) up 12%, KLA-Tencor (NASDAQ:<a href="https://seekingalpha.com/symbol/KLAC" target="_blank">KLAC</a>) up 9% and Lam Research (NASDAQ:<a href="https://seekingalpha.com/symbol/LRCX" target="_blank">LRCX</a>) up nearly 8%.</li> <li data-xf-list-type="ul">Auto chipmakers, which are getting pricing power, also gained, with STMicroelectronics (NYSE:<a href="https://seekingalpha.com/symbol/STM" target="_blank">STM</a>) up 4%, Texas Instruments (NASDAQ:<a href="https://seekingalpha.com/symbol/TXN" target="_blank">TXN</a>) up 7% and Microchip (NASDAQ:<a href="https://seekingalpha.com/symbol/MCHP" target="_blank">MCHP</a>) up nearly 4%, all higher three weeks in a row.</li> <li data-xf-list-type="ul">The Philadelphia Semiconductor ETF (NASDAQ:<a href="https://seekingalpha.com/symbol/SOXX" target="_blank">SOXX</a>) rose nearly 3% last week and the VanEck Vectors Semiconductor ETF (NASDAQ:<a href="https://seekingalpha.com/symbol/SMH" target="_blank">SMH</a>) rose 3.4%.</li> <li data-xf-list-type="ul">“The semi shortage has highlighted the vulnerability of the supply chain for the US,” UBS says.</li> <li data-xf-list-type="ul">But Congressional and White House incentives for domestic production and a “sea change” on how companies view the supply chain could “accelerate the reshoring trend that has been a focus since the disruptive events of COVID-19 and the US China trade dispute,” the bank argues.</li> <li data-xf-list-type="ul">“Companies have recently commented on how the transition of supply chains out of China last year has helped them to weather the current crisis,” analyst Adam Scheiner writes in a note. “The crisis has also highlighted how companies cannot afford to have all their supply coming from one country that could shut down their entire manufacturing footprint. Localizing efforts could cause a boost in new factory construction, which could benefit companies exposed to automation and robotics technologies.”</li> <li data-xf-list-type="ul">He adds that new plants should have greater automation, which could benefit stocks in that area (see UBS chart below).</li> </ul><p></p><p>[ATTACH=full]1696051[/ATTACH]</p><p></p><ul> <li data-xf-list-type="ul">Rockwell Automation (NYSE:<a href="https://seekingalpha.com/symbol/ROK" target="_blank">ROK</a>) is an “obvious beneficiary” and its “recent acquisitions have also dealt with remote monitoring and virtualization which has added attractiveness due to the recent pandemic.”</li> <li data-xf-list-type="ul">Emerson (NYSE:<a href="https://seekingalpha.com/symbol/EMR" target="_blank">EMR</a>) is another beneficiary, while Honeywell (NYSE:<a href="https://seekingalpha.com/symbol/HON" target="_blank">HON</a>) has increased its automation exposure.</li> <li data-xf-list-type="ul">UBS also sees new spending for manufacturing and factory floor, good for Parker-Hannifin (NYSE:<a href="https://seekingalpha.com/symbol/PH" target="_blank">PH</a>) and Fortive (NYSE:<a href="https://seekingalpha.com/symbol/FTV" target="_blank">FTV</a>).</li> <li data-xf-list-type="ul">Meanwhile, Seeking Alpha contributor Kwan-Chen argues Nvidia is not as vulnerable to the chip shortage as previously thought, and <a href="https://seekingalpha.com/article/4414220-dont-sell-nvidia-because-of-chip-shortage" target="_blank">may emerge from tight supply earlier than rivals</a>.</li> </ul></blockquote><p></p>
[QUOTE="Weather Man, post: 16598764, member: 137766"] [URL='https://seekingalpha.com/news/3677001-chip-shortage-rages-on-but-reshoring-opportunities-are-growing']Chip shortage rages on, but reshoring opportunities are growing: Alpha Tactics[/URL] [LIST] [*]The semiconductor shortage continues to impact different segments of the market. [*]On Friday, Nio temporarily suspended vehicle production at the JAC-NIO manufacturing plant in Hefei for [URL='https://seekingalpha.com/news/3676661-nio-halts-production-lowers-vehicle-delivery-outlook']five days due to lack of chips[/URL]. [*]And Stellantis said it would temporarily [URL='https://seekingalpha.com/news/3676971-stellantis-to-temporarily-close-five-north-american-plants']close five North American plants[/URL]. [*]The chip shortage was largely due to spiking pandemic-related demand for notebooks, smartphones, game consoles and other consumer electronics. And the auto industry cut orders for chips when demand plunged at the start of lockdowns and [URL='https://seekingalpha.com/news/3659294-auto-chip-shortage-driving-61b-in-lost-sales-faces-complicated-recovery']lost their already low priority at semiconductor foundries[/URL]. [*]Semi equipment makers [URL='https://seekingalpha.com/news/3676818-auto-chip-shortage-worsens-after-blackouts-and-fire-sending-semi-suppliers-higher']gained this past week[/URL], with Applied Materials (NASDAQ:[URL='https://seekingalpha.com/symbol/AMAT']AMAT[/URL]) up 12%, KLA-Tencor (NASDAQ:[URL='https://seekingalpha.com/symbol/KLAC']KLAC[/URL]) up 9% and Lam Research (NASDAQ:[URL='https://seekingalpha.com/symbol/LRCX']LRCX[/URL]) up nearly 8%. [*]Auto chipmakers, which are getting pricing power, also gained, with STMicroelectronics (NYSE:[URL='https://seekingalpha.com/symbol/STM']STM[/URL]) up 4%, Texas Instruments (NASDAQ:[URL='https://seekingalpha.com/symbol/TXN']TXN[/URL]) up 7% and Microchip (NASDAQ:[URL='https://seekingalpha.com/symbol/MCHP']MCHP[/URL]) up nearly 4%, all higher three weeks in a row. [*]The Philadelphia Semiconductor ETF (NASDAQ:[URL='https://seekingalpha.com/symbol/SOXX']SOXX[/URL]) rose nearly 3% last week and the VanEck Vectors Semiconductor ETF (NASDAQ:[URL='https://seekingalpha.com/symbol/SMH']SMH[/URL]) rose 3.4%. [*]“The semi shortage has highlighted the vulnerability of the supply chain for the US,” UBS says. [*]But Congressional and White House incentives for domestic production and a “sea change” on how companies view the supply chain could “accelerate the reshoring trend that has been a focus since the disruptive events of COVID-19 and the US China trade dispute,” the bank argues. [*]“Companies have recently commented on how the transition of supply chains out of China last year has helped them to weather the current crisis,” analyst Adam Scheiner writes in a note. “The crisis has also highlighted how companies cannot afford to have all their supply coming from one country that could shut down their entire manufacturing footprint. Localizing efforts could cause a boost in new factory construction, which could benefit companies exposed to automation and robotics technologies.” [*]He adds that new plants should have greater automation, which could benefit stocks in that area (see UBS chart below). [/LIST] [ATTACH=full]1696051[/ATTACH] [LIST] [*]Rockwell Automation (NYSE:[URL='https://seekingalpha.com/symbol/ROK']ROK[/URL]) is an “obvious beneficiary” and its “recent acquisitions have also dealt with remote monitoring and virtualization which has added attractiveness due to the recent pandemic.” [*]Emerson (NYSE:[URL='https://seekingalpha.com/symbol/EMR']EMR[/URL]) is another beneficiary, while Honeywell (NYSE:[URL='https://seekingalpha.com/symbol/HON']HON[/URL]) has increased its automation exposure. [*]UBS also sees new spending for manufacturing and factory floor, good for Parker-Hannifin (NYSE:[URL='https://seekingalpha.com/symbol/PH']PH[/URL]) and Fortive (NYSE:[URL='https://seekingalpha.com/symbol/FTV']FTV[/URL]). [*]Meanwhile, Seeking Alpha contributor Kwan-Chen argues Nvidia is not as vulnerable to the chip shortage as previously thought, and [URL='https://seekingalpha.com/article/4414220-dont-sell-nvidia-because-of-chip-shortage']may emerge from tight supply earlier than rivals[/URL]. [/LIST] [/QUOTE]
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SVTPerformance's Chain of Restaurants
Road Side Pub
Frying Pan Into the Fire -- Chip Shortage
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