Rare Opportunity: Top Chip Stocks to Buy Now (LRCX, ASML, MU)

Semiconductor stocks have struggled since last summer, with the SMH ETF underperforming the broader market and several individual names experiencing sharp corrections—a familiar pattern in this highly cyclical industry.

But not all chip stocks are created equal. Some companies provide highly specialized, mission-critical technologies that support the incredibly complex semiconductor manufacturing process. These firms have built durable, long-term advantages through deep industry entrenchment, recurring revenues, and strong business models, which has made them some of the best compounding stocks over time, despite periodic volatility.

After a 10-month correction, select names now trade well off their highs, creating a rare opportunity for investors to gain exposure to long-term winners at attractive valuations. ASML Holdings (ASML), Lam Research (LRCX),andMicron Technology (MU) all stand out today with compelling growth catalysts, upward-trending earnings estimates, and reasonable valuations, making them three of the most attractive stocks to consider right now.

ASML Holdings: An Irreplaceable Chip Stock

ASML Holdings is a linchpin of the global semiconductor industry. The company is the sole producer of extreme ultraviolet (EUV) lithography machines, which are essential for manufacturing the world’s most advanced chips. These systems are so complex and capital-intensive that no other company has been able to replicate them, making ASML’s role in the semiconductor supply chain truly irreplaceable.

ASML currently holds a Zacks Rank #2 (Buy), supported by a near-unanimous wave of earnings estimate upgrades. This reflects growing optimism around both demand for its systems and the company's long-term earnings power.

Despite its unmatched position in the chipmaking process, ASML is trading at just 28x forward earnings, which is below its long-term median and suggests the stock may still be undervalued relative to its growth prospects. Analysts expect earnings to grow at an impressive 18.9% annually over the next three to five years, making ASML one of the most compelling long-term plays in the semiconductor space.

Lam Research: A Core Stock Holding for Chip Investors

Lam Research is a foundational player in the semiconductor ecosystem, specializing in etch and deposition equipment, which are two of the most critical and complex steps in advanced chip manufacturing. Its tools are deeply embedded in the production lines of the world’s leading foundries and memory makers, including TSMC, Samsung, Intel, and Micron. Because Lam’s systems are custom-built and highly integrated into client workflows, they enjoy long replacement cycles and high switching costs, making the company’s revenue base both sticky and resilient.

LRCX currently holds a Zacks Rank #2 (Buy), supported by a wave of upward earnings revisions. Just in the past week, current quarter estimates jumped 21.9%, while full-year forecasts climbed 6.4%, a strong signal of improving fundamentals and growing analyst confidence.

Despite its vital role in the chip supply chain and robust earnings momentum, Lam trades at just 21.4x forward earnings, a modest valuation given its leadership position. Earnings per share are projected to grow at a 17.7% annual rate over the next three to five years, making LRCX a compelling core holding for long-term semiconductor investors.

Micron Technology: A Comeback Stock

Micron Technology is a global leader in memory and storage solutions, specializing in DRAM and NAND flash—two essential building blocks in everything from smartphones and laptops to data centers, AI systems, and autonomous vehicles. As one of the few US-based memory manufacturers, Micron plays a critical role in the expansion of domestic semiconductor capabilities, aligning with national efforts to boost chip production under the CHIPS Act and reduce reliance on foreign supply chains.

After navigating a prolonged downturn, Micron is now firmly in comeback mode. While it currently holds a Zacks Rank #3 (Hold) due to mixed near-term revisions, the company is seeing rapidly improving fundamentals and rising demand across key end markets.

Sales are projected to grow 41.3% this year and 30% next year, while EPS is expected to surge 433% in 2025 and another 55.7% in 2026, highlighting the strong recovery underway.

Despite this robust growth outlook, Micron trades at just 14x forward earnings. For investors looking to participate in the semiconductor rebound and the strategic reshoring of US chip capabilities, Micron offers a high-upside, comeback opportunity.

Should Investors Buy Shares in LRCX, MU and ASML?

For long-term investors, Lam Research, Micron, and ASML offer a rare mix of industry leadership, strong earnings growth, and reasonable valuations. Each plays a critical role in the global chip supply chain, and recent pullbacks have opened the door to own these high-quality names at a discount. With improving fundamentals and favorable long-term trends, these stocks deserve a closer look now.

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This article originally published on Zacks Investment Research (zacks.com).

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