The AI rally on the stock markets is causing massive price gains for US chip stocks – but Infineon can only benefit to a limited extent. What is slowing down the DAX group.
• Infineon is at a disadvantage compared to US competitors
• Automotive specialist is suffering from the global lull in electric cars
• Infineon remains a more defensive beneficiary of the long-term energy transition
The price rally in the semiconductor sector has set new records in recent weeks, but a closer look at the price charts reveals a clear geographical and sectoral divide. While US heavyweights such as AMD dominated the headlines in the last five trading days with an increase of 33.28 percent and Intel with an increase of over 30 percent, Infineon’s performance remained comparatively moderate with an increase of 7.93 percent. This discrepancy is also clearly visible in a year-to-date comparison: While Intel more than tripled its value with an increase of 238.54 percent, the Munich DAX group recorded a solid but significantly smaller increase of 63.42 percent.
The focus on computing power is slowing down the automotive specialist
The main reason for these valuation differences lies in the current prioritization of the capital markets. Investors are currently specifically looking for companies that will benefit directly from the hardware infrastructure for artificial intelligence. Here AMD scores as an alternative in the AI accelerator market and Micron scores through the shortage of specialized AI memories. Infineon, on the other hand, is positioned fundamentally differently. Around half of the Munich-based company’s turnover depends on the automotive sector. In this area, the industry is currently struggling with a cyclical slowdown in electromobility in Europe and high inventories among manufacturers, which is noticeably dampening the massive AI euphoria within the Infineon portfolio.
Although Infineon, as the world’s leading supplier of power semiconductors, plays a key role in powering AI data centers, this aspect is currently still perceived as a marginal issue by the market. In Wall Street logic, Intel and AMD are considered the “brains” of the AI revolution, while Infineon represents the efficient “nerve pathway”. This perception leads to the company being valued more as a cyclical industrial stock and less as a pure AI growth promise. As long as the uncertainty in the global automotive market continues, Infineon will only be able to keep up with the enormous momentum of pure processor manufacturers to a limited extent, even if the operating margin in the area of energy transition technologies remains stable.
Portfolio dilemma for investors
This raises the question for investors as to whether the comparatively weaker price development could open up potential for catch-up in the long term. The fundamental valuation of the DAX stock is significantly more attractive compared to the hot US stocks, but carries the risk that the recovery in the automotive sector will take longer than hoped. While AMD and Intel have already priced in extreme growth expectations for the coming years, Infineon could benefit from a stabilization of the global industrial economy. The stock therefore remains a bet on the broad electrification of the global economy, while US competition is currently primarily driven by the hype surrounding computing capacity.
Claudia Stephan, editorial team at finanzen.net
By the way: AMD (Advanced Micro Devices) and other US stocks can even be traded on finanzen.net ZERO until 11 p.m. (without order fees, plus spreads). Open a depot now for free and secure a new customer bonus!
Selected leverage products on AMD (Advanced Micro Devices)
With knock-outs, speculative investors can participate disproportionately in price movements. Simply select the lever you want and we will show you suitable open-end products on AMD (Advanced Micro Devices)
The leverage must be between 2 and 20
Advertising
