MACOM, Nvidia, Amtech, Semtech, and Nova Shares Are Falling, What You Need To Know

What Happened?

A number of stocks fell in the afternoon session after markets continued to retreat, as investors re-evaluated the high valuations of stocks that benefited from the artificial intelligence boom. 

After a fantastic run, many of those high-flying AI and technology stocks saw investors take profits: selling shares to lock in their gains. This is often called a "market rotation." Money is moving out of the red-hot tech sector (which some worry has become too expensive) and into other parts of the market that investors may currently deem more stable or reasonably-priced. 

There's a secondary reason for the cautious mood: The long government shutdown came to an end. Though it's typically interpreted as good news, it also means a flood of delayed economic reports will be released. For weeks, investors were "flying blind" without key updates on the economy's health, like inflation data and the jobs report. In typical "sell the news" fashion, investors may also be taking profits and selling in anticipation that the new data would potentially give the Federal Reserve reasons to slow or even pause future rate cuts.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Analog Semiconductors company MACOM (NASDAQ:MTSI) fell 4.8%. Is now the time to buy MACOM? Access our full analysis report here, it’s free for active Edge members.
• Processors and Graphics Chips company Nvidia (NASDAQ:NVDA) fell 4.2%. Is now the time to buy Nvidia? Access our full analysis report here, it’s free for active Edge members.
• Semiconductor Manufacturing company Amtech (NASDAQ:ASYS) fell 4.3%. Is now the time to buy Amtech? Access our full analysis report here, it’s free for active Edge members.
• Semiconductor Manufacturing company Semtech (NASDAQ:SMTC) fell 4.9%. Is now the time to buy Semtech? Access our full analysis report here, it’s free for active Edge members.
• Semiconductor Manufacturing company Nova (NASDAQ:NVMI) fell 4.6%. Is now the time to buy Nova? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Semtech (SMTC)

Semtech’s shares are extremely volatile and have had 50 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 2 days ago when the stock dropped 3.7% as negative news from a data center company and a significant sale of Nvidia shares by a major investor fueled a broader sell-off. 

The downturn in chip stocks followed an announcement from CoreWeave Inc that a data center delay would negatively affect its financial expectations, leading to a downgrade by JPMorgan Chase. This news created concern across the industry, weighing on other chipmakers including ARM Holdings, Micron Technology, and Lam Research. Further pressure came as the technology-heavy Nasdaq Composite index fell, with companies like Nvidia dropping after reports that SoftBank had sold its stake.

Semtech is up 8.2% since the beginning of the year, but at $67.20 per share, it is still trading 12.9% below its 52-week high of $77.15 from January 2025. Investors who bought $1,000 worth of Semtech’s shares 5 years ago would now be looking at an investment worth $1,028.

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