iShares Semiconductor ETF rated buy on strong AI-driven hyperscaler spending and solid earnings growth.

The iShares Semiconductor ETF (SOXX) received a buy rating, supported by significant hyperscaler capital expenditures totaling $1.15 trillion, which benefit its top holdings like NVDA, AVGO, MU, and AMD. These companies are well positioned to gain from the ongoing AI infrastructure buildout, with contracts already signed. Projected blended earnings growth for SOXX's top 10 holdings ranges from 32% to 38%, outpacing expected multiple compression and supporting a 17% total return in the base case. Despite risks from memory price fluctuations and potential capex cuts, SOXX offers high liquidity, tradability, and diversified exposure across the semiconductor supply chain, making it an attractive thematic investment with sector-specific risks to consider.