These 'safer' chip stocks have boomed this -2-

Earnings commentary within the industry has been encouraging. Lead times for semiconductor capital equipment are usually six to nine months, meaning customers are ordering in advance, Mizuho's Klein noted. He added that companies such as Applied Materials (AMAT), Lam Research (LRCX) and KLA (KLAC) have sent positive signals about demand going forward.

Earlier this week, Applied Materials guided for more than 20% growth in its semiconductor-systems business for 2026.

Read: Applied Materials' stock jumps after earnings. The CEO just made a bold prediction for the chip sector.

Applied Materials is "the largest semicap with the broadest portfolio," Bank of America analyst Vivek Arya noted, writing that the company is therefore positioned for "strong leverage" in the multiyear growth cycle for wafer-fabrication equipment. Demand for such equipment is being driven by the need for leading-edge foundry and logic chips, and for dynamic random-access memory, he wrote in a Thursday report.

RBC Capital Markets analyst Srini Pajjuri also highlighted Applied Materials' leadership when it comes to equipment for DRAM and high-bandwidth memory, as well as for advanced logic chips and packaging technology - all of which are in high demand to support AI. He wrote in a note to clients on Thursday that he expects spending on DRAM to keep rising as semiconductor manufacturing capacity expands and as companies launch greenfield projects starting next year.

-Britney Nguyen -Philip van Doorn

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02-14-26 0930ET