Relative Strength Of Semiconductors

by: Bespoke Investment Group

With stocks like Intel (NASDAQ:INTC) trading near 52-week lows, it should come as no surprise that semiconductor stocks have been underperforming the broader market. What may be a surprise to some is that not all semiconductors have been equally as bad.

The chart below compares the relative strength of the S&P 1500 Semiconductor group versus the S&P 500 over the last year on both a market cap weighted (light blue) and a non market cap weighted basis (dark blue). In the chart, rising lines indicate that semiconductors are outperforming the S&P 500 and vice versa. As shown in the chart, both the market cap and non-market cap weighted semiconductor indices have underperformed the S&P 500 by a wide margin in the last year. That being said, a close look at the chart shows that the un-weighted semiconductor index has been turning higher in the last month. This has caused the performance gap between the two indices to widen out close to its highest levels in a year.

Even though the market cap weighted semiconductor group is down just under 1% in November, the average stock in the group is actually up 1.14%. Of the 62 stocks in the group, 36 are up, 25 are down, and one stock is unchanged. In fact, 21 stocks are up more than 5% during the month of November. Those names are listed in the table below, and while the best performing stock on the table has a price of less than $3 per share, the average price of the stocks listed in the table is more than $20, so there are also plenty of stocks with more 'normal' share prices.