Two semiconductor stocks that have been underperforming this year could see big gains as semiconductor trading gains momentum, according to Loop Capital. Semiconductor stocks witnessed explosive gains in 2025, with most of the popular chipmakers in the market tied to building artificial intelligence data center infrastructure. Loop Capital expects the semiconductor sector to deliver strong gains in 2026 as well, but is betting on a broader rally, especially as growth in automotive and industrial chips accelerates. Given this growing strength, analyst Gary Mobley has highlighted ON Semiconductor and Synopsys as his firm’s mid-cap and large-cap semiconductor picks for 2026, respectively. Mobley raised his price target on Synopsys, which he rates a buy, from $570 to $600. That suggests the company’s stock, which provides services such as silicon design and electronic design automation used in AI products, could rise nearly 28% from Wednesday’s closing price. SNPS 1Y Mountain Synopsys stock price performance over the past year. Synopsys stock has fallen 3% for the year, but has risen more than 5% in the past month. Shares rose slightly after Nvidia announced in early December that it had purchased Synopsys common stock for $2 billion as part of a strategic partnership to accelerate computing and AI engineering solutions. Mobley said Synopsys should benefit from growth in the electronic design automation (EDA) market. EDA refers to specialized software used to design and simulate semiconductor chips before manufacturing. He also noted that Synopsys reduced uncertainty about its FY26 outlook when it released its first outlook on December 10. “We believe AI-enhanced EDA tools will enter a new growth paradigm in the EDA market, resulting in higher annual contract values as licensees renew,” the analyst said in a note to clients on Friday. “A combination of China’s export restrictions and an uneven recovery in the semiconductor industry have recently obscured the long-term growth potential of the EDA industry. However, China is currently a relatively small component, especially for SNPS.” Mobley’s 2026 mid-cap chip pick, ON Semiconductor, could rise 38.5% from its most recent closing price, according to his price target of $75 per share. ON Semiconductor’s stock price fell more than 14% in 2025, reflecting concerns about weaker demand in key end markets such as automotive and industrial. Mobley expects ON Semiconductor’s manufacturing utilization to steadily improve from the first quarter through 2026, providing a tailwind for margins. Additionally, analysts noted that the company’s long-term revenue mix continues to shift toward higher-margin products this year.
