Investing.com --BofA Securities upgraded Ambarella Inc (NASDAQ: AMBA ) to “neutral” from “underperform,” with the price target raised to $80 from $65, on expected growth acceleration. Advanced Energy Industries Inc (NASDAQ: AEIS ) was also upgraded to ‘buy’ from ‘neutral,’ with a new price target of $140, reflecting operational leverage.

Whereas Microchip Technology Inc (NASDAQ: MCHP ) was downgraded to ‘underperform’ from ‘neutral,’ with the price target lowered to $65 from $80, as analysts see limited catalysts for near-term growth.

For 2025, BofA forecasts 15% growth in the semiconductor industry, with core semiconductors excluding memory rising 13%.

Analysts highlighted strong momentum in AI semiconductors during the first half of the year, driven by Nvidia (NASDAQ: NVDA ) deployments, but expect a shift to auto and industrial chipmakers in the second half due to inventory normalization.

Top picks for 2025 include Nvidia, Broadcom (NASDAQ: AVGO ), Marvell (NASDAQ: MRVL ) Technology, and Lam Research (NASDAQ: LRCX ). These stocks are poised to benefit from AI trends and a potential recovery in capital expenditures and cyclical markets.

BofA noted risks from China restrictions and macroeconomic uncertainties but maintains a positive long-term outlook for semiconductor growth.