The sturdiness of the technology sector this year in the face of tumult for Internet and social media stocks has come courtesy of older, more mature companies.
Old guard semiconductor companies have participated in and aided the old school tech rally. For example, shares of Intel (NasdaqGS: INTC) are up 9.5% this year while Qualcomm (NasdaqGS: QCOM) is up 8%. Texas Instruments (NasdaqGS: TXN) has climbed 11.3%. [Best Tech ETF for Conservative Investors]
Although those stocks are not major components in the SPDR S&P Semiconductor ETF (NYSEArca: XSD), stellar semiconductor stocks and a bounce in small-caps are boosting XSD. Over the past month, the equal weight XSD is up almost 11%. Only two U.S. sector ETFs have been better over that time: The SPDR S&P Biotech ETF (NYSEArca: XBI) and the PowerShares Dynamic Biotechnology & Genome Portfolio (NYSEArca: PBE). [Why These Biotech ETFs are Surging]
The $145.9 million XSD holds 51 stocks, the weighted average market value of which is $10.1 billion, indicating a distinctly mid-cap flare to this ETF. Along those lines, Qualcomm is not a member of XSD’s lineup while Intel and Texas Instruments combine for just 4.5% of the ETF’s weight.
XSD is up almost 9% in the past 90 days an hit a new 52-week high on Tuesday, but that does not mean the fund is running out of steam. Global semiconductor sales jumped 12% year-over-year in April. “Sales have now increased year-to-year for 12 straight months, a trend the SIA expects to continue for the rest of 2014 and into 2015,” according to Dow Jones Newswires.
At the end of May, OmniVision Technologies (NasdaqGS: OVTI), XSD’s largest holding at a weight of 2.75%, reported EPS and sales results that topped Wall Street estimates. The stock is up 20.3% in the past month. Shares of Broadcomm (NasdaqGS: BRCM), XSD’s second-largest holding, are up almost 28% in the past month.
Last week, Skyworks Solutions (NasdaqGS: SWKS), XSD’s third-largest holding, raised its third-quarter EPS forecast to 80 cents from 73 cents and its revenue estimate to $570 million from $535 million.
XSD sports a P/E ratio of 19.33, according to State Street data, indicating the ETF trades at a slight discount to the NASDAQ-100.
SPDR S&P Semiconductor ETF
ETF Trends editorial team contribute to this article.