Mizuho analysts noted Friday that semiconductor chip stocks have risen Friday. TSM is currently at +4%, while NVDA, AMAT, KLAC, and LRCX have all gained more than 2%.
The rise follows etch and deposition tool supplier Tokyo Electron's bullish outlook today in Japan on AI-driven equipment demand into their March end full-year 2025, notes Mizuho.
"In semi-cap eqpt, Tokyo Electron is a direct comp of LRCX and AMAT, and while their results and guide were generally inline, it seems like their outlook and comments on the semi equipment market will create excitement," they explained.
"They report after KLAC and LRCX, albeit before AMAT, but are saying despite still subdued capital investment spending in memory and advanced logic/foundry, there was an increase in demand for advanced packaging for Gen AI."
Mizuho believes semiconductor capex spending is showing signs of a bottom, while investment in mature node auto, IoT, and industrial equipment in China for self-sufficiency continues to be strong and should continue to rise compared to last year.
"In sum, not hearing anything really new here, but suggests better demand / orders are likely on the way in the advanced logic and foundry segments and China to remain strong. Best order demand trends sound like HBM DRAM and packaging for AI," conclude Mizuho.