Broadcom And 2 AI Chip Stocks To Watch

AI heavyweights are projected to pour up to US$828b into data centers and chips this year, and that wall of spending is putting the entire semiconductor build out under the microscope. Volatile prices and sentiment can create windows that close fast. This article breaks down three stocks from our semiconductor supply chain screener that plug directly into that AI hardware demand and explains what makes each worth a closer look.

The three stocks below are a sample pulled from a much larger semiconductor supply chain screen. This screen surfaced 56 more companies with equally compelling AI hardware stories that are not covered here.

If you want to move beyond a handful of examples and quickly identify your own highest conviction angles on AI infrastructure, head straight into the Semiconductor Supply Chain screener to filter and analyze the full set of opportunities.

Broadcom (AVGO)

Broadcom plugs directly into the AI hardware build out through its custom chips and networking gear for data centers. Its software arm adds a second pillar that helps smooth out the cycles in pure semiconductor spending.

Broadcom develops custom semiconductors for AI data-center networking and sells infrastructure software, with about US$59.4b from Semiconductor Solutions and US$29.7b from Infrastructure Software, and carries a roughly US$1.65t market value.

"The market is asking whether AI spending remains strong over the next few quarters. I believe the more important question is whether the world will require significantly more computing, connectivity, networking bandwidth, and data movement over the next decade."

For investors tracking Broadcom, a single pressure point around how this AI build out is financed could be what really shifts the story.

If that funding question is the real swing factor, the full narrative for Broadcom explains how Broadcom’s AI story could accelerate or stall as capital cycles shift.

ASML Holding (ENXTAM:ASML)

ASML Holding is the equipment supplier that lets chipmakers actually print the ultra-small circuitry inside high‑end AI processors, with extreme ultraviolet lithography systems at the center of that role. The group generates about €39.5b from semiconductor equipment and services and carries a roughly €541b market value.

"Export restrictions, especially involving China, have turned ASML into a geopolitical chokepoint. Governments understand that controlling ASML means influencing the future of computing, AI, and defense technologies."

What happens to ASML’s grip on pricing and order books if one unseen pressure in that geopolitical and funding mix abruptly changes course?

If that unseen pressure is what decides how strong ASML Holding’s grip really is, the full narrative for ASML Holding shows where the story could be quietly accelerating.

PDF Solutions (PDFS)

PDF Solutions sits on the plumbing of AI chip manufacturing, wiring together factory data and analytics for the fabs, foundries, and equipment suppliers in this screener, which sets up a very different type of exposure to the semiconductor supply chain theme.

PDF Solutions runs a software centric manufacturing analytics and factory connectivity business for chipmakers and equipment vendors, generating about US$241 million from Software & Programming and carrying a roughly US$1.9b market value.

"Accelerated enterprise adoption of PDF Solutions secure, cloud-based supply chain orchestration and analytics software, including secureWISE, Sapience Manufacturing Hub and Exensio, continues to be supported by a multi year secureWISE agreement with a major equipment vendor that covers virtually all 300mm fabs and is expected to support higher recurring revenue and improved earnings visibility."

What happens to PDF Solutions’ earnings power if one key assumption about how quickly manufacturers standardize on its platform quietly shifts?

That adoption curve is the real swing factor. The full narrative for PDF Solutions unpacks how recurring software, chip cycles, and capital intensity could be quietly reshaping PDF Solutions’ upside profile.

Seeking Alternatives Before Everyone Else?

Fresh ideas move first. By the time most investors react, early momentum can be flying or quietly dropping out of reach. Scan these under the radar lists and consider your options.

• Spot potential breakouts with strong cash flow backing them by tracking the 29 high quality undervalued stocks while the valuations still look reasonable and the stories remain under the radar.
• Review companies linked to structural demand for electricity and grid upgrades by scanning the 39 power grid technology and infrastructure stocks before infrastructure trends are fully reflected in headline valuations and more widely followed trades.
• Explore recurring cash flows from income-focused opportunities by reviewing the 5 dividend fortresses while yields are available and before any shifts in demand are fully reflected in share prices.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com