3 Semiconductor Stocks to Buy on the DeepSeek Turbulence

Core Viewpoint - The emergence of DeepSeek, a China-based AI company, has caused significant concern in the U.S. tech sector, leading to a sharp sell-off in stocks as it claims to offer competitive AI capabilities at a lower cost compared to established U.S. companies [1][2]. Group 1: Market Reaction - Following the announcement of DeepSeek's AI model, major companies like NVIDIA, Marvell, and Broadcom experienced substantial losses, with NVIDIA alone losing $593 billion in market value, marking the largest one-day loss in history [2][3]. - The Philadelphia semiconductor index fell by 9.2%, the largest percentage drop since March 2020, indicating widespread panic in the tech sector [3]. Group 2: Company Responses - OpenAI CEO Sam Altman acknowledged the potential of DeepSeek's model, suggesting that competition could be beneficial for innovation in AI [4]. - Microsoft CEO Satya Nadella expressed optimism, referencing Jevons Paradox and suggesting that increased efficiency in AI could lead to greater usage [4]. Group 3: Company Profiles - NVIDIA: Expected earnings growth rate for the current year is 126.2%, with a return on equity (ROE) of 114.8% and a Zacks Rank of 2 [5]. - Broadcom: Expected earnings growth rate for the current year is 29.6%, with a ROE of 28% and a Zacks Rank of 2 [6]. - Marvell: Expected earnings growth rate for the current year is 3.3%, with a ROE of 4.6% and a Zacks Rank of 1 [7].