TLDR
- Citigroup elevated Nvidia, Broadcom, Texas Instruments, and Monolithic Power Systems to its preferred semiconductor selections
- AI infrastructure investments have pushed data center chip demand to 34% of the total semiconductor market
- Nvidia delivered $68.1 billion in quarterly revenue, marking 73% year-over-year growth; Broadcom saw 29% revenue increase to $19.31 billion
- Citigroup established $270 price objective for Nvidia and $475 target for Broadcom
- Intel and Qualcomm only garnered Neutral ratings, facing headwinds from sluggish PC and smartphone demand
Following the recent earnings season, Citigroup analysts highlighted four semiconductor manufacturers as their preferred stock selections. The investment bank issued Buy ratings for Nvidia, Broadcom, Texas Instruments, and Monolithic Power Systems.
According to the bank’s research, data center applications now represent approximately 34% of total semiconductor market demand. Sustained capital deployment in artificial intelligence infrastructure continues to fuel robust demand in this segment.
Citigroup positions Nvidia and Broadcom as essential portfolio holdings for investors seeking exposure to AI-driven capital expenditure. The bank selected Texas Instruments and Monolithic Power based on favorable product cycles and operational enhancements.
Nvidia delivered quarterly revenue of $68.1 billion, representing a 73% year-over-year surge. The majority of this expansion stemmed from AI accelerator chips deployed in hyperscale data centers operated by leading cloud service providers.
Citigroup established a $270 price objective for Nvidia. Wall Street consensus forecasts approximately 49% potential upside for the shares, accompanied by a Strong Buy recommendation.
Broadcom announced first-quarter fiscal 2026 revenue of $19.31 billion, up 29% compared to the prior-year period. The company’s adjusted earnings per share reached $2.05, narrowly exceeding the Street’s $2.03 consensus projection.
Artificial Intelligence Infrastructure Propels Semiconductor Sector
Citigroup assigned a $475 price objective to Broadcom. Analyst consensus suggests approximately 33% upside potential from present levels, also carrying a Strong Buy rating.
Texas Instruments disclosed quarterly earnings per share of $1.27, modestly below the $1.29 Street estimate. The company generated $4.42 billion in revenue, slightly under the $4.44 billion consensus, though still reflecting 10% year-over-year expansion.
Management provided current-quarter guidance projecting revenue in the range of $4.32 billion to $4.68 billion. Citigroup’s $235 price target for Texas Instruments suggests approximately 13.47% appreciation potential.
Monolithic Power Systems surpassed expectations with $4.79 earnings per share versus the $4.73 consensus estimate. The company posted $751.2 million in revenue, climbing roughly 20.8% year-over-year and exceeding the $740 million forecast.
Monolithic Power issued first-quarter revenue guidance of $770 million to $790 million. Wall Street analysts project approximately 23% upside with a Strong Buy consensus rating.
Traditional Computing Segments Show Weakness
Citigroup excluded several chipmakers from its top-tier list. The bank maintained Neutral ratings on Qualcomm and Intel, pointing to diminished demand associated with personal computer and smartphone markets.
The investment bank observed that elevated memory component pricing could suppress unit shipments across these categories. Citigroup set price objectives of $140 for Qualcomm and $48 for Intel.
The industrial semiconductor segment, accounting for roughly 10% of chip demand, is tracking marginally above typical seasonal patterns. Automotive chip demand, comprising approximately 11% of the market, remains relatively stable.
Citigroup’s $1,350 price objective for Monolithic Power represents the most aggressive target among the four highlighted stocks.
