These ‘safer' chip stocks have boomed this year. Is it too late to buy in?

The semiconductor equipment sector is experiencing a transformative moment, driven by the explosive growth of artificial intelligence technologies. As chip manufacturers race to expand production capacity, companies producing semiconductor manufacturing equipment are emerging as surprising investment opportunities in 2026.

Mizuho analyst Jordan Klein recently highlighted an unprecedented market dynamic: for the first time in years, investors are showing sustained confidence in semiconductor capital equipment manufacturers. These companies, which produce complex machines and software essential for chip production, are benefiting from a structural shift in technology demand.

The AI-driven boom has disrupted traditional semiconductor industry cycles, creating unique investment opportunities. While many tech stocks have experienced volatility, semiconductor equipment producers appear positioned to deliver more stable returns. Their business model relies on providing critical infrastructure for chip manufacturing, making them potentially less risky than direct chip manufacturers.

Key players in this sector are leveraging generative AI's unprecedented computing requirements to expand their market reach. Companies specializing in advanced manufacturing tools are seeing increased valuations, with some analysts suggesting certain stocks remain relatively undervalued compared to their growth potential.

For precious metals investors, this semiconductor equipment trend presents intriguing indirect opportunities. The massive computational infrastructure required by AI will drive significant silver demand in electronics, solar panels, and advanced manufacturing equipment, potentially creating a supportive long-term price environment for industrial silver markets.