Adding to 2 Chip-Related Plays, Watching Technicals on Another Holding
Earnings this week from Alphabet, Texas Instruments, Intel and others may lead to a few ratings changes.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
| AMAT | Buy | 48 | 525.70 | 280 | 4.1 |
| MRVL | Buy | 120 | 194.94 | 120 | 0.7 |
After you receive this Alert, the Pro Portfolio will make the following trades:
— Buy 48 shares of Applied Materials (AMAT) at or near $553. Following the trade, we will own 280 AMAT shares, accounting for roughly 2.5% of the Pro Portfolio’s assets.
— Buy 120 shares of Marvell (MRVL) at or near $205. Following the trade, we will own 770 MRVL shares, accounting for roughly 2.6% of the Pro Portfolio’s assets.
Coming off price hike comments from Taiwan Semiconductor (TSM) and raised guidance from wafer company IQE plc (IQEPF) discussed earlier today, we are adding to the Portfolio’s position in these two holdings.
The data points collected from Taiwan Semi and IQE are the latest that reaffirm demand for AI and data-center chips remains robust, and that incremental chip capacity persists to address that demand as well as overcome shortages for other end markets.
We’ve been looking for a favorable entry points to increase the Portfolio’s position in AMAT and to rebuild our position in MRVL after having locked in massive gains in June at levels substantially higher than last night’s closing share price. We started that rebuilding process last week, and today’s move is another step in that direction.
Helping spur us into action that takes advantage of the recent drops in MRVL and AMAT is the recent positive test of support, with AMAT shares bouncing off its 50-day moving average and MRVL doing the same for its 100-day moving average.
Following these nibbles on AMAT and MRVL shares, their overall positions sizes will still be on the smaller side, which affords us the potential opportunity to add further to both, subject to market conditions as we move through the current earnings season, and the market digests potential White House tariff news later this week.
Subject to what we hear from Alphabet (GOOGL), Texas Instruments (TXN), Intel (INTC) and others this week, we may review our current Two ratings on AMAT and MRVL. In terms of our respective checkpoints, we will reset MRVL’s to $185 from $200, and AMAT’s to $475 from $500. While we are making these mathematical moves today, as the shares rebound, we intend to revisit those levels with an upward bias.
Eye on Axon
As we make these moves, we are also keeping an eye on Axon Enterprise (AXON). Signals we shared over the weekend reaffirm the demand profile for its body cameras and AI tools. We discussed one of the key factors behind that, which is the current police shortage, yesterday on Yahoo! Finance.
Should we see a positive test of support for AXON shares at the 200-day moving average, that would likely lead us to scoop up some additional shares for the Portfolio. Such a move would help rebuild our position in AXON following our locking in a slice of gains at $626.60 earlier this month.
More Pro Portfolio:
- Trimming One Holding, Adding to Another as We Boost Our Rating
- We’re Tracking 23 Signals Across 10 Portfolio Investing Strategies
- Weekly Roundup: Chip Rout Tests the Market, but Here’s How We Aim to Capitalize
(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade’s executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long AMAT, AXON, GOOGL, and MRVL.
