buy semiconductor stocks as ‘Chips Act’ cleared a key Senate vote

It’s time to turn bullish on the semiconductor stocks now that the “Chips Act” has cleared a key Senate vote, says Mark Smith. He’s the Senior Vice President at Wells Fargo Advisors.

Smith’s remarks on CNBC’s ‘The Exchange’

That potential tailwind, Smith added, warrants “dollar cost averaging” considering the sector is down more than 35% versus the start of the year 2022. On CNBC’s “The Exchange”, he said:

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If you’re a long-term investor and you’re not going to use this money for 20-30 years, you’ll look back and see that this was a great buying opportunity. If it goes lower, buy some more. Like Mr Buffet, he’s buying them too.

The bipartisan bill that aims at making the United States more self-sufficient in terms of semiconductor manufacturing is now awaiting final vote before it moves to the House.

Demand for computer chips is here to stay

If the “Chips Act” passes the Senate, U.S. based semiconductor manufacturers will receive about $52 billion in funding on top of tax incentives to domestically produce and innovate computer chips. Smith noted:

That’s an unprecedented investment in the semi space. So, you’ve got to be bullish. We can put some money behind our chips and be one of the largest producers of semiconductors, may be not tomorrow, but definitely in next five to ten years.

U.S. is currently dependent on the likes of Taiwan and Ukraine to meet its semiconductor needs. Smith is also bullish on chip stocks since he’s convinced the demand will only go up in the coming years.