Ross Gerber, Co-founder of the investment firm Gerber Kawasaki, on Thursday, said his team was forced to sell some positions in semiconductor stocks like Micron Technology Inc (NASDAQ:MU), Nvidia Corp (NASDAQ:NVDA), and Broadcom Inc (NASDAQ:AVGO) to comply with the sector cap limit.  

Diversification Rules Prompt Semiconductor Sales

In a post on X, Gerber said, "Today we had to sell a small amount of our positions in semis" – Micron, Nvidia and Broadcom.

The diversification rule has forced a reduction in semiconductor holdings even as he reiterated a bullish stance on the group. He said, "This was a requirement of diversification in my fund of 25% max in a sector, not because of my desire in any way. I am very bullish on these companies."

The semiconductor stocks have been on a tear this year on the AI-fueled semiconductor boom. The PHLX Semiconductor Index recently reached its highest level since March 2000.

Micron

Micron has been on a remarkable surge, having gained more than 714% over the past year and 172% since the start of this year. The rally has lifted the memory chipmaker's market capitalization near $900 billion, vaulting the Boise-based memory maker into the top 10 most valuable U.S. tech companies.

Gerber claimed that the stock could reach $1,140 based on projected earnings per share (EPS) of $57 for 2026 and over $100 for 2027. This optimistic valuation reflects a significant potential upside of about 47% from its price of $776.01 as of May 14.

Bank of America raised its price target on MU to $950 from $500, citing growing confidence in the memory market.

Benzinga Edge Stock Rankings indicate that MU has a Momentum score in the 99th percentile. It maintains a strong price trend in the short, medium and long term.

Read Also: Nvidia Overtakes Silver To Become World's Second-Largest Asset At $5.52 Trillion, Market Commentator Calls It 'Historic Technological Revolution

Nvidia

The AI chipmaker has soared about 74% over the past year and 26.4% since the start of this year. It hit another record high of $236.54 on Thursday. AI remains a key driver of its growth, with demand for compute capacity expected to exceed supply. Nvidia is pushing toward becoming a top-tier asset in a market increasingly dominated by AI-driven technology.

Wells Fargo recently increased its price target for Nvidia from $265 to $315, highlighting continued confidence in Nvidia’s trajectory.

Benzinga Edge Stock Rankings indicate that Nvidia stock has a Momentum score in the 84th percentile. It maintains a strong price trend in the short, medium and long term.

Broadcom

Broadcom surged to a new high of $442.36 on Thursday, implying gains of about 89% over the past year. The stock is up about 27% year-to-date. Broadcom has become a major custom-chip beneficiary as hyperscalers seek alternatives to an all-Nvidia strategy.

Wells Fargo turned more bullish on Broadcom, raising the target price to $545 from $430, arguing that Wall Street may still be underestimating the scale of AI infrastructure demand tied to hyperscaler data center expansion.

Benzinga Edge Stock Rankings indicate that AVGO has a Momentum score in the 86th percentile. It maintains a strong price trend in the short, medium and long term.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by a Benzinga editor.

Read Also: Howard Lutnick Says US Is 'Bringing Back' Semiconductor Manufacturing: Here Are ETFs That Could Benefit

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