What Happened?

A number of stocks jumped in the afternoon session after the VanEck Semiconductor ETF jumped nearly 5% in response to the de-escalation of the U.S.-Iran conflict. 

The sector rallied specifically because semiconductors were highly vulnerable to the supply chain disruptions that occurred during the war. The reopening of the Strait of Hormuz is a critical victory for the industry, as the waterway is essential for the transit of noble gases and materials used in chip fabrication.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Analog Semiconductors company Analog Devices (NASDAQ: ADI) jumped 6%. Is now the time to buy Analog Devices? Access our full analysis report here, it’s free.
• Analog Semiconductors company NXP Semiconductors (NASDAQ: NXPI) jumped 4.9%. Is now the time to buy NXP Semiconductors? Access our full analysis report here, it’s free.

Zooming In On Analog Devices (ADI)

Analog Devices’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 15 days ago when the stock gained 2.8% on the news that the Trump administration announced a plan to create a voluntary investment consortium targeting $4 trillion in funding for semiconductor supply chains, energy projects, and critical minerals. 

The initiative, an expansion of the 'Pax Silica' program launched in December 2025, aims to secure access to AI and chipmaking for the U.S. and its allies. According to reports, the U.S. government will contribute an initial $250 million toward the ambitious goal. This move signals strong government support for the domestic and allied chip industry, boosting investor confidence. The prospect of significant capital infusion into the sector could lead to the development of new manufacturing facilities, research advancements, and a more resilient global supply chain, benefiting chipmakers and related technology companies.

Analog Devices is up 26.4% since the beginning of the year, and at $346.06 per share, it is trading close to its 52-week high of $360.80 from February 2026. Investors who bought $1,000 worth of Analog Devices’s shares 5 years ago would now be looking at an investment worth $2,135.

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