Jefferies sees H1 peak for European semiconductor cycle, to plateau from mid-2025
09/01/2025 08:16
** Jefferies expects the semiconductor cycle to peak in H1 and
plateau for the rest of 2025, before a projected rebound for
automotive and industrial chipmakers into 2026
** It says sales and margins of auto and industrial semis should
bottom in coming quarters amid inventory correction, while
markets are likely to look beyond that to the next upcycle
** Among these stocks, Jefferies prefers Infineon IFXGn.DE
("buy") over STMicroelectronics STMPA.PA ("hold") and ams
OSRAM AMS2.VI ("buy") on safer 2025 estimates and higher
structural growth
** It also upgrades Melexis MLXS.BR to "buy" from "hold" ahead
of the expected recovery
** Semiconductor equipment suppliers remain constrained by
slower growth in AI demand and low 2026 visibility, Jefferies
says, though it adds WFE (wafer fab equipment) weakness in 2025
looks priced in
** It prefers ASM International ASMI.AS over ASML ASML.AS
(both "buy"), saying it is most geared to rising advanced logic
spend
** It downgrades VAT Group VACN.S and SUSS MicroTec SMHNn.DE
to "hold" from "buy" over demand concerns
** It resumes Nordic Semiconductor NOD.OL at "buy" on 2026 EPS
growth expectations, and names it along with Soitec SOIT.PA
("buy") and Melexis as its SMID cap top picks
(Reporting by Johan Bodinier in Gdansk)
((Johangeorgesroger.bodinier@thomsonreuters.com))