The shortage of semiconductors during a boom in electric vehicle sales could help raise profits at a handful of chip makers, according to Bank of America.
The investment bank said shares of U.S.-listed European chip maker STMicroelectronics and Japan's Renesas Electronics could rise by more than 75% over the next year on that trend.
Although global automotive sales are expected to rise by just 3-4% over the next two years, the transition to EV cars means chip sales are set to grow by 7-9% year after year for the next two years, the Wall Street bank said.
The company said auto revenues grew 44% in 2021 due to chip sales for in-car connectivity devices.
Other chip stocks set to benefit from the trend to EV vehicles include U.S.-based companies Marvell , Microchip , Nvidia and Ambarella , Wolfspeed , and Onsemi , as well as European semiconductor manufacturers NXP and Soitec .