Semiconductor stocks have a reputation for being the most expensive in town, but that's not really the case. The past several months have tested investor resolve, with many chip stocks experiencing sharp corrections that have erased gains and left portfolios bruised.
That said, this has created the very conditions that produce outsized returns.
When broad-based selling hits a sector as structurally important as semiconductors, it rarely discriminates between the fundamentally broken and the merely misunderstood. You can buy large-cap stocks like Nvidia (NVDA) or Broadcom (AVGO), but smaller companies with strong operational foundations are also worth having exposure to. More interest rate cuts are expected later this year, and that should help these small caps out.
Here are three top-rated chip stocks to look into that are more agile and have more growth potential. Do note that buying these stocks naturally includes taking on more risk, as they have smaller market caps than the aforementioned chipmaking juggernauts.
Atomera (ATOM)
Atomera (ATOM) is a semiconductor materials and intellectual property licensing company. It does not build fabs or produce finished semiconductors. The company re-engineers silicon substrates, and this is what they call a “quantum engineered superlattice.” The modification allows performance gains and cost advantages.
It could allow better DRAM and SRAM, and since the memory market is quite hot, the demand could cause the stock to rebound.
If you look at the addressable market, the bull case gets quite compelling. ATOM's market cap is just $81 million at the moment. Since the company licenses IP and is not involved in chip manufacturing, revenues have high margins and flow almost directly to the bottom line. The problem is, there's no meaningful revenue yet.
If even one major foundry moves MST into high-volume manufacturing and begins paying royalties, the revenue shift from near-zero to tens of millions would be seismic relative to the current valuation.
The average price target of $5 implies the stock could double from here.
GCT Semiconductor (GCTS)
GCT Semiconductor (GCTS) is a fabless semiconductor company that designs advanced 5G and 4G LTE system-on-chip (SoC) platforms. It sells chipsets that integrate radio frequency (RF), baseband modem, and digital signal processing (DSP) functions onto a single chip.
The market cap is just $71 million, but it's worth bottom-fishing if you want disproportionate gains.
5G and the ongoing satellite industry's expansion could be the spark that leads to multibagger gains. The company announced its first commercial shipments of a 5G chipset to lead customers in January 2026. GCT isn't trying to compete head-to-head with Qualcomm (QCOM) or MediaTek in mainstream smartphones. Instead, it's carving out niches that are highly attractive to companies making direct-to-satellite communications.
Those keeping tabs on the market are aware that companies like AST SpaceMobile (ASTS) are on the precipice of making satellite-to-phone 5G a reality.
Analyst price targets have an average price target of $3.83, implying over 308% upside potential.
Intchains Group (ICG)
Intchains Group (ICG) is a Shanghai-based fabless semiconductor company that designs application-specific integrated circuit (ASIC) chips purpose-built for cryptocurrency mining. The focus is mostly on altcoins. Currently, the crypto market looks rather unattractive. Bitcoin (BTCUSD) has halved from its peak, with altcoins like Ethereum (ETHUSD) only barely setting a new all-time high before retreating.
That said, buying during the crypto winter sets you up for significant gains if the market ends up recovering. ICG's revenue is profoundly cyclical, so if prices surge and mining demand spikes, it will drive massive order volumes for its ASIC chips.
A tentative altseason will bring the juiciest gains here, though the market has been expecting it for over a year now.
The average analyst price target is $3.50, implying over 230% upside potential.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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