If you’re looking for GloFo stock, you’re in luck! How many times have we written about companies that haven’t gone public? Well, now you can read about a company that you can trade in GlobalFoundries stock.
What is GlobalFoundries?
GlobalFoundries is a multinational corporation that’s in the business of making semiconductor components. It’s the fourth-largest semiconductor producer in the world and produces microchips for 7% of the global market.
The company was actually formed when it was spun off from chipmaker AMD (NASDAQ: AMD). Officially, GlobalFoundries was created due to a divestiture of the manufacturing segment of AMD when the company decided to go fabless.
Since then, GlobalFoundries has expanded its reach and is the only chip component maker in the United States and the European Union. This has provided them with trusted foundry status from the US government. And us with a GlobalFoundries stock.
With the rapid advancement of technology, the global chip industry has been in high demand. In fact, we witnessed a chip shortage this past year that had a direct impact on global supply chains. Products in nearly every market were affected, from Apple (NASDAQ: AAPL) MacBook Pro laptops to electric vehicles.
GlobalFoundries is based out of Malta, New York, although it’s officially incorporated in the Cayman Islands. It was officially created back in 2009, making it a relatively new company in the markets. The company holds over 10,000 patents in the chip-making industry and is positioned to be an industry leader moving forward. Let’s keep reading about GlobalFoundries stock!
Can I Buy GloFo Stock?
Actually, yes! GlobalFoundries stock (NASDAQ: GFS) went public via an IPO on October 27th, 2021. That means the company had been publicly traded for just under two weeks at the time this article is being written. Shares debuted on the NASDAQ exchange at right around $45.00 and soared as high as $66.00 per share. It’s now trading at just below $60.00 per share as the stock pulls back following its post-IPO hype.
GlobalFoundries stock currently has a market cap of $31 billion and reported revenues of more than $3 billion for the first half of 2021. If you want to buy GlobalFoundries stock, all you need to do is open a trading account at a brokerage site. Ensure that the site you pick allows you to trade US equities. So you can buy GloFo stock!
So What is a Foundry?
A foundry is a semiconductor manufacturing plant that creates components for chips such as integrated circuits. Don’t be confused between foundries and other pure-play chipmakers.
Foundries create chips for designers without factories or fabs. The semiconductor industry is a little complicated to understand.
Fabless companies are much more common as they don’t need to dedicate capital and expenses to a factory. Instead, they hire these foundries like GlobalFoundries to build out their inventory at a cheaper price. What are some examples of Foundry Companies? Let’s take a look!
Taiwan Semiconductor Company (NYSE: TSM): It’s known as the largest semiconductor company in the world. Taiwan Semiconductor was founded in 1987 and established in the Hsinchu Science Park in Taiwan.
TSM is a near $600 billion company and is a near-lock to one day be a trillion-dollar company. Fabless chip makers that use Taiwan Semiconductor to make their chips include AMD, Broadcom (NASDAQ: AVGO), and NVIDIA (NASDAQ: NVDA).
Taiwan Semiconductor dominates the global market with a staggering 55% share of the fabless industry. Last year, the company reported over $45 billion in revenues and is fast becoming one of the most important companies in the world.
GloFo Stock Foundry Competitors
Samsung: The Korean tech giant is known for many things, but it usually isn’t associated with being a foundry. It’s actually the second-largest foundry company in the world and owns roughly 17% of the global fabless market. Samsung’s foundry arm operates separately under the Samsung Foundry Business segment. It is in the process of manufacturing a giant production line in the city of Pyeongtaek. This line will produce both 14nm DRAM and 5nm logic semiconductors using UV photolithography technology.
United Microelectronics Corporation (NYSE: UMC): United Microelectronics Corporation is a smaller company than GlobalFoundries with a market cap of only $28 billion. Still, the Taiwanese company commands a higher market share, particularly amongst Asian countries. The company owns and operates twelve different fabs across Asia. UMC owns the highest market share of RF SOI on 12-inch wafers with a 16% global market share.
China’s Semiconductor Manufacturing International Corporation: This Shanghai-based company has its stock trading on the Hong Kong stock exchange. It is the largest and most advanced foundry in Mainland China, with a global market share of 4%. Some fabless companies that utilize SMIC’s chips include Broadcom and Qualcomm (NASDAQ: QCOM). It should be noted that China is attempting to rapidly scale its existing chip manufacturing industry. The global superpower was hit hard by the ongoing chip shortage and sees a space in the market where it can capture a larger share.
What is an IDM Company?
IDM or Integrated Device Manufacturer is what we traditionally think of as chip makers. These IDM companies process, design, manufacturer, test, and package the semiconductors to other partners.
These companies can make their chips in-house, and do not need to rely on a foundry to make more. Let’s take a look at some of the more well-known IDM companies on the stock market.
Intel (NASDAQ: INTC): Founded in 1968, Intel has always been a major player in the chip industry. Intel has taken some lumps as of late, including losing the contract for future iterations of Apple’s (NASDAQ: AAPL) MacBook Pro computers.
Still, Intel is a $207 billion business according to its market cap and is still a major brand in the industry. Further to this, Intel recently unveiled its plans for a shift in focus for the business from fabless to foundry.
The plan is called IDM 2.0 and involves the implementation of a foundry network within Intel. This means Intel will be operating its own foundry factories and taking some of its chip manufacturing in-house.
Texas Instruments (NASDAQ: TXN): The Dallas-based company produces analog chips and embedded processors. Texas Instruments is one of the largest manufacturers of semiconductors in the world, and its chips are used in a wide range of products. Its stock trades on the NASDAQ exchange and currently carries with it a market cap of just over $175 billion. It doesn’t usually get as many headlines or acknowledgment as other IDM chip makers, but Texas Instruments is a well-established, iconic brand in the industry.
What About the Rest of the Chip Industry?
So we’ve discussed IDMs and Foundries. But what about the other brands besides GloFo stock that is more commonly known? A majority of the larger names that we know of as investors are fabless chipmakers. This means they get most of their chips made by either foundry companies or IDMs. They still do most of the design and functionality development, but the actual manufacturing is sent to other companies.
AMD (NASDAQ: AMD): AMD has really turned things around over the past few years. Once seen as a lower quality chip than Intel, AMD is now the dominant name in computer chips. AMD has also made great strides in the data center market which could be one of the leading users of chips in the future. AMD has also been adopted by major consumer products like the next generation of gaming consoles from Sony and Microsoft (NASDAQ: MSFT), as well as inside Tesla (NASDAQ: TSLA) cars. Most recently, AMD announced a partnership with Facebook or Meta Platforms (NASDAQ: FB). This should see AMD as one of the leading chip makers for the new Metaverse platform, and any of Meta’s new products.
NVIDIA (NASDAQ: NVDA): Talk about a runaway train of a company, NVIDIA has surpassed nearly every fabless chipmaker in the world. The company has its hands in nearly every sector, but its data center, artificial intelligence, and autonomous driving chips should lead the company into the future. NVIDIA is now nearly an $800 billion company and has recently unveiled its own version of the Metaverse called the Omniverse. Overall, it is one of the most powerful companies in the world and should be a part of every investor’s diversified portfolio.
Broadcom (NASDAQ: AVGO): Broadcom certainly does not receive as much attention as AMD or NVIDIA, but the Silicon Valley company can hold its own. Broadcom itself is a $230 billion company and creates chips for nearly every sector known to man. Its core technologies include modems and other networking infrastructure, data centers, and optical sensing.
Qualcomm (NASDAQ: QCOM): Another Silicon Valley fabless chipmaker, Qualcomm is most well known for its Snapdragon chips. These are found in most smartphones these days including the newest versions of the Apple (NASDAQ: AAPL) iPhone. Qualcomm is one of the pioneers of the mobile data industry and is an excellent investment in the future of 5G technology.
Conclusion on GloFo Stock
So now you have learned the difference between the various chipmakers and you can buy Glofo stock. Technology is only improving at faster and faster rates and the chip sector is rapidly becoming one of the most important. GlobalFoundries is one of the largest foundry companies in the world.
We learned that a foundry is more or less a factory that mass produces chips for other companies. These other companies are called fabless chip makers and include some of the largest names in this stock sector. Every investor should have some exposure to the chip industry in their portfolios.
All of the companies we talked about are excellent, including GlobalFoundries stock. These companies will be the foundation for all future technology. As a result, add them to your portfolio today!