We just published the list of 10 Best Memory Stocks to Buy According to Billionaires and Silicon Motion Technology (NASDAQ:SIMO) ranked 9th on the list.
In the first half of the year, memory was the hottest AI trade. Hyperscalers poured billions of dollars into data centers where high-bandwidth memory was one of the tightest bottlenecks in the supply chain. Most of the memory stocks rallied as a result, though the returns have been muted in the second half of the year so far, accompanied by high volatility.
Some on Wall Street say memory makers are sold out till 2030. Others say only till 2028. While the exact status of the industry can be debated, there’s little doubt about the willingness of stock market investors to pay a higher multiple for memory stocks. This debate has been done to death, and memory makers continue to trade at extremely low forward earnings multiples, implying that the earnings cycle has peaked.
So what’s the truth? Is it the end of the boom? Or is the structural shift in the memory business finally here? If you would rather avoid the high-risk nature of AI stocks, particularly memory and storage, you could look at companies that are doing the exact opposite, i.e., bringing in healthy cash flows and carrying low debt in our list of 10 Stocks With Low Debt and Strong Free Cash Flow.
But if you want exposure to the best memory stocks, read on. In my quest for the answer to the above questions, I reached out to a person who regularly interviews industry experts to find out answers to questions like these. I asked a famous Substack and X analyst, P Equity Research, whether ‘this time was really different’. Here’s what he had to say:
“There are essentially 3 important conditions these memory makers set in their LTAs: volume, price, duration. They are all negotiating LTAs to fix volume, a price floor, and duration of contract to get rid of past boom and bust cycles in the industry. As long as the Capex cycle holds strong, yes, they are sold out for 2028 and will be potentially beyond that.”
So how are billionaire investors treating memory stocks with so much negativity surrounding the business? That’s exactly what I wanted to find out with my article 10 Best Memory Stocks to Buy According to Billionaires.
Close-up of Silicon Die are being Extracted from Semiconductor Wafer and Attached to Substrate by Pick and Place Machine. Computer Chip Manufacturing at Fab. Semiconductor Packaging Process.
To come up with my article 10 Best Memory Stocks to Buy According to Billionaires, I first looked up multiple memory ETFs to list all memory stocks. In this list, I include stocks that derive at least 30% of their revenue from memory-related products and services. My list also bundles memory and storage stocks together. That is because some storage types also utilize memory chips and, more importantly, they face the exact same cyclicality that memory stocks are notorious for. They are listed in ascending order of the number of billionaires holding them in their portfolios.
