Qualcomm slips as chips fall, even as Bernstein highlights firm for 2023
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Qualcomm (NASDAQ:QCOM) closed down more than 1.8% on Friday, among the weakest stocks in the semiconductor sector, even as investment firm Bernstein listed the San Diego-based chipmaker among its top picks in the sector for next year.
Advanced Micro Devices (NASDAQ:AMD), Nvidia (NASDAQ:NVDA), Qualcomm (QCOM) and Broadcom (AVGO) are investment firm Bernstein's top picks in the semiconductor sector going into 2023, as the first three have seen their estimates cut "markedly" and Broadcom (AVGO) still has a record backlog.
Analyst Stacy Rasgon selected Advanced Micro Devices (AMD), Nvidia (NVDA), Qualcomm (QCOM) and Broadcom (AVGO) as the firm's top picks for next year, noting that the first three have seen their estimates cut "markedly" and Broadcom (AVGO) still has a record backlog.
"In the current environment we would be looking for names that have cut, and where there is a strong secular story that can play off that bottom (AMD, QCOM, and NVDA come to mind, as well as, potentially, semicap), and would continue to pitch AVGO for the cyclically nervous," Rasgon wrote in a note to clients.
AMD (AMD) lost 1.7%, while Nvidia (NVDA) and Broadcom (AVGO) declined 2.3% and 0.4%, respectively.
Other semiconductor stocks that Rasgon viewed favorably include Applied Materials (AMAT), Lam Research (LRCX) and Analog Devices (ADI).
Applied Materials (AMAT) shares and Analog Devices (ADI) finished fractionally higher, while Lam Research (LRCX) declined less than 0.5%. 
Taiwan Semiconductor (NYSE:TSM) shares fell more than 1.6% to close at $76.30 on Friday even as Bank of America said its exposure to China would be "manageable" in the wake of the Biden Administrations's newly announced order adding Yangtze Memory Technologies and 21 other "major" Chinese companies to a trade backlist.
Analyst Brad Lin noted that Taiwan Semiconductor (TSM) now only gets roughly 8% of its revenue from China, down from a peak of 22% in 2020 when it still had Huawei as a client. Additionally, the company's expansion into global manufacturing sites, notably in Arizona, should "help lower the relevant geopolitical risks in the long run," Lin wrote in a note to clients.
Most other semiconductor stocks were lower in Friday trade, including Intel (INTC), Texas Instruments (TXN) and NXP Semiconductors (NXPI). Micron Technology (MU) finished with a fractional gain while ON Semiconductor (ON) bucked the trend, rising nearly 2%.
On Thursday, Morgan Stanley analyst Joseph Moore said that AMD (AMD) had replaced Lam Research (LRCX) as the firm's top semiconductor stock for 2023.