Tom Lee Says Chip Stock Pullback Presents Another Buying Opportunity
N.R. Finch
Fundstrat's Tom Lee argues the semiconductor ETF's roughly 8% single-day drop is a textbook buyable pullback — historically, 88% of the time the index recovers and posts gains within a month, a key win-rate signal for holders.
How big was the sell-off?
On June 23, the iShares SOXX Semiconductor ETF fell roughly 8% in a single session; the Nasdaq-100-tracking QQQ ETF dropped about 3%.
Asia mirrored the move — South Korea's KOSPI slid nearly 10%, making this a globally synchronized tech sell-off.
This means → the decline was not company-specific bad news but a broad, cross-border risk-off event concentrated in tech.
What is Tom Lee's case for buying?
Lee counted 17 instances since 2011 when the semiconductor index fell 6% or more in a single day; nearly every one proved to be a good entry point in hindsight.
In his client note he wrote: across those cases, 88% of the time the index not only recovered the full drop within one month but also posted positive returns.
In plain terms = of 17 comparable crashes, roughly 15 bounced back with gains inside a month — Lee is betting on that historical win rate.
Any signs of recovery already?
By the morning of June 24, semiconductor leaders including Broadcom and Intel had already edged higher.
Before the sell-off, the SOXX ETF had rallied as much as 84% since late March; the Roundhill Memory ETF had surged roughly 150% since its early-April launch.
This means → even after the drop, chip stocks' gains from the late-March starting point remain substantial — the pullback is not extreme relative to the prior run-up.
Is the memory price surge a double-edged sword?
Memory — a foundational component of AI computing power, handling temporary data storage and retrieval — has gained strong pricing power on robust demand, lifting the sector's profit-margin outlook significantly.
Yet downstream tech companies face cost pressure. Apple CEO Tim Cook said on the late-April earnings call: "For the June quarter, we expect memory costs to rise meaningfully. Beyond June, the impact will grow, and we will continue to evaluate it closely."
This reflects a tension running through the entire supply chain: the AI boom is boosting upstream chip makers' earnings, but the bill ultimately lands on hardware companies and consumers downstream — bullish and bearish forces coexist on the same value chain.
Content is for reference only, not financial advice.