This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Earnings Reports Play on Semiconductor ETFs

NEW YORK (TheStreet) - Three companies in the semiconductor sector are reporting earnings this week, and this will have an impact on Semiconductor HOLDRs (SMH).

Intel Corp. (INTC) will be issuing their earnings report for the latest quarter on Tuesday after the market closes, along with Linear Technology Corp. (LLTC).

Later in the week, Advanced Micro Devices (AMD) will report their first quarter earnings on Thursday after the market closes.

Anyone who has ever looked at the sticker on their computer indicating the company that makes the processor has likely heard of Intel, which sells parts for a multitude of various electronic devices. The company's chips power three quarters of the PCs in the world.

Although not as famous, LLTC also makes components for electronics such as cell phones, cameras, computers, and GPS systems, among other things. AMD is only slightly smaller by market capitalization but has a narrower focus and sticks to mainly providing parts for home computers, office servers and video game consoles.

In comparison, INTC's market capitalization is roughly 20 times that of LLTC or AMD.

Among the semiconductor sector ETFs with exposure to these three companies, SMH allocates the greatest amount of net assets to INTC, AMD and LLTC. INTC accounts for 23.8% of SMH, while LLTC and AMD account for 5.1% and 1.3%, respectively.

However, earnings in this sector can be an unpredictable foundation on which to base an investment decision. For instance, last quarter, INTC reported very well but shares lost value on the day. It can happen that general market sentiment, financial news, or expectations of what earnings should be for a company will have a larger impact on shares when they issue their quarterly report than the strength of the report itself.

Hopes are again high this earnings session for Intel to beat expectations and for the semiconductor sector to report well because the industry has seen strong demand over the course of the quarter.

However, hardware demand in the latter part of the year is also expected to remain strong. ETF Investors looking beyond an earnings play for this week should look to iShares S&P North American Technology-Semiconductors Index Fund (IGW).

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,915.07 -70.54 -0.42%
S&P 500 1,964.68 -8.15 -0.41%
NASDAQ 4,396.2040 -22.83 -0.52%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs