Among the leading semiconductor stocks, Applied Materials (NASDAQ: STM) saw the most significant rises in short interest between the September 30 and October 15 settlement dates.

The number of shares sold short in Advanced Micro Devices (NYSE: LSI) and Texas Instruments (NASDAQ: TXN) also grew somewhat.

The short interest in Broadcom (NASDAQ: BRCM) was essentially unchanged from the previous period.

However, short sellers retreated from KLA-Tencor (NASDAQ: KLAC), Marvell Technology (NASDAQ: MRVL), NVIDIA (NASDAQ: NVDA) and Qualcomm (NASDAQ: QCOM) in early October.

Here we take a closer look at how Applied Materials, Micron Technology and STMicroelectronics have fared and what analysts expect from them.

See also: Short Interest In Facebook Falls, In Groupon Rises

Applied Materials

This equipment and services provider to the semiconductor industry saw short interest jump more than 36 percent in the period to around 28.90 million shares. That was the greatest number of shares sold short in at least a year. The short interest was more than two percent of the float.

Applied Materials acquisition of Tokyo Electron for $9.4 billion remained the focus during the period. The Santa Clara, California-based company has a market capitalization of more than $21 billion and a dividend yield near 2.2 percent. The long-term earnings per share (EPS) growth forecast of this S&P 500 component is about nine percent.

Half of the 20 analysts who follow the stock and were surveyed by Thomson/First Call recommend buying shares, and four of them rated the stock at Strong Buy. The mean price target, or where the analysts expect the share price to go, is about the same as the current share price, meaning analysts see no upside potential at this time.

Shares have met resistance near $18 for the past month. The current share price is less than 50 percent higher year-to-date. The stock has outperformed not only the Nasdaq over the past six months, but also competitors such as KLA-Tencor and Lam Research (NASDAQ: LRCX).

Micron Technology

This Boise-based semiconductor device maker saw short interest grow about 18 percent to 109.02 million shares, taking back most of the decline in the previous period. More than 10 percent of Micron shares were short at the end of the period, but the days to cover fell to less than two.

Micron Technology swung to a profit in the most recent quarter due to a one-time gain. The company has a market cap of a little more than $17 billion. The long-term EPS growth forecast of this S&P 500 component is near 18 percent, and the operating margin is better than the industry average.

Of the 31 analysts who were surveyed, 15 recommend buying shares, with eight of them rating the stock at Strong Buy. They believe the stock has plenty of headroom, as their mean price target is more than 23 percent higher than the current share price. Shares have not traded at that level since 2002.

The share price reached a new 52-week high earlier in the month but has pulled back more than 10 percent since then. It is still up about 150 percent year-to-date. The stock has outperformed the Nasdaq and the Dow Jones Industrial Average over the past six months.

See also: Short Sellers Retreat From Biogen Idec, Move On Pharmacyclics

STMicroelectronics

Short interest in this Swiss integrated circuits maker rose about 27 percent in the initial two weeks of October to more than 4.40 million shares. That was the greatest number of shares sold short in the past year. It would take about five days to close out all of the short positions.

Cisco Systems (NASDAQ: CSCO) awarded STMicroelectronics an Excellence in Sustainability Award during the period. The company has a market cap of more than $6 billion and a dividend yield near 4.6 percent. Note that the return on equity and the operating margin are both in the red.

The consensus recommendation of the seven polled analysts is to buy STMicroelectronics shares, and it has been for at least three months. Their mean price target is more than 16 percent higher than the current share price. However, shares were trading higher than that two weeks ago.

Shares have retreated more than 17 percent since the beginning of October, most of that decline coming last week following an earnings report. Over the past six months, the stock has underperformed larger competitor Texas Instruments and the S&P 500.

At the time of this writing, the author had no position in the mentioned equities.

Follow us on Twitter.

Related Articles
  1. Budgeting

    The Honest Company Bundles Review: Are They Worth It?

    Learn more about The Honest Company and its bundle subscription services, which deliver discounted diapers, formula and other baby products to your doorstep.
  2. Products and Investments

    The One Thing Your Portfolio Must Always Have

    Portfolio diversification is essential in any situation, but especially so as the market finally returns to fundamentals.
  3. Budgeting

    Blue Apron Review: Is It Worth It?

    Read about one of the top meal-kit delivery services in the United States, and learn more about what it offers and how much it costs.
  4. Budgeting

    Plated Review, Is It Worth It?

    Take a closer look at the ready-to-cook meal service, Plated, and learn how the company can help you take the hassle out of home cooking.
  5. Investing News

    How China's Economy is Now Like America's

    China's economy could take the global economy down with it; why that might be good news in the grand scheme.
  6. Investing News

    A 2016 Outlook: What January 2009 Can Teach Us

    January 2009 and January 2016 were similar from an investment standpoint, but from a forward-looking perspective, they were very different.
  7. Fundamental Analysis

    South Korea - King of Exports

    Read about one the most important and successful exporting countries in the world, and learn more about the types of products it exports.
  8. Investing News

    Volatility Vexed? See What the Experts Are Saying

    Volatile times lead to a diversity of opinions on where the market is headed. Here are takes from five investing luminaries.
  9. Investing Basics

    The January Barometer: Is it Still Relevant?

    The January Barometer has been historically accurate. Will that be the case in 2016?
  10. Investing News

    The 8 Highest Grossing Movies of 2015

    Count down the most popular films at the American box office in 2015, and learn how much they earned in the domestic and worldwide markets.
RELATED FAQS
  1. What is the long-term outlook of the metals and mining sector?

    An industry agency council was established by the World Economic Forum in 2014 to serve as an advisory board on the future ... Read Full Answer >>
  2. What is the railroads sector?

    The railroads sector is comprised of publicly traded stocks for companies that operate railroad tracks and/or trains. Railroad ... Read Full Answer >>
  3. Who are Amgen Inc.'s (AMGN) main competitors?

    Biotech giant Amgen Inc (AMGN) bills itself as one of the first biotechnology firms. It was founded in 1980 and has grown ... Read Full Answer >>
  4. What's the most expensive stock of all time?

    Back in late August 2012, Apple’s (AAPL) stock price reached nearly $700 per share. The stock has since split but has yet ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center