Bank of America has recently made rating adjustments to multiple chip stocks, including Intel (INTC.US), Applied Materials (AMAT.US), and Texas Instruments (TXN.US).

Specifically, Bank of America downgraded Intel from "Neutral" to "Underperform" while maintaining its $34 target price. Analysts noted that Intel's market cap has risen by $80 billion recently, fully reflecting expectations for balance sheet improvements and external foundry potential. However, analysts emphasized that Intel's competitive outlook still faces challenges, including a lack of clear artificial intelligence (AI) product portfolio or strategy, insufficient competitiveness in server CPU products, and reduced flexibility in divesting loss-making manufacturing operations compared to the past.

Bank of America also downgraded Texas Instruments from "Neutral" to "Underperform," lowering its target price from $208 to $190. Analysts pointed out that despite the company's high asset quality and stable execution, global tariff volatility may suppress demand recovery in the industrial sector over the short to medium term. Additionally, unlike some peers, Texas Instruments has limited benefits from the current AI capital expenditure cycle.

Bank of America also downgraded GlobalFoundries (GFS.US) from "Neutral" to "Underperform" with a $35 target price. Analysts stated that the rating downgrade reflects their assessment of GlobalFoundries' short-term macroeconomic headwinds, while adjusting earnings forecasts slightly below market consensus. Analysts believe the $35 target price implies limited upside potential from current stock price levels. While no specific triggers for immediate stock price decline are apparent, analysts noted that the company needs to demonstrate faster gross margin improvements and pricing power enhancement compared to the past two years to change market sentiment.

Bank of America downgraded Axcelis Technologies (ACLS.US) from "Neutral" to "Underperform."

Additionally, Bank of America analysts expect the memory market to remain strong in 2026, with approximately 16% year-over-year growth, primarily benefiting from NAND expansion projects and DRAM equipment investment recovery. Recent memory price increases and capacity constraints may stimulate HBM and high-end memory expansion.

Bank of America upgraded Applied Materials from "Neutral" to "Buy," raising its target price to $250. Analysts noted that benefiting from DRAM investment recovery, the wafer fabrication equipment (WFE) market is expected to see its first strong growth in four years in 2026. Additionally, the company's valuation is more attractive compared to larger peers.

Bank of America upgraded Camtek (CAMT.US) from "Neutral" to "Buy," raising its target price to $135. Analysts stated that with surging high bandwidth memory (HBM) testing demand, the company's sales growth is expected to accelerate again.

Notably, Bank of America also raised target prices for Lam Research (LRCX.US), KLA Corporation (KLAC.US), Nova (NVMI.US), MKS Instruments (MKSI.US), and Teradyne (TER.US). Bank of America noted that Lam Research remains its most favored semiconductor equipment stock due to its diversified capability to exceed WFE growth. Among small and mid-cap companies, Bank of America also favors MKS Instruments due to its leverage to NAND and relatively reasonable valuation.