Smh stock price strength has been aided by renewed

SMH stock price strength has been aided by renewed capital flows into growth sectors as Treasury yields eased this week. As of May 31, SMH has delivered an enviable annualized three-year return of 25.5%. This stellar return easily trumps that of the broader market. The Vanguard S&P 500 ( NYSEARCA:VOO ) returned 9.6% on an annualized basis over the same time frame. It even beats the strong performance of the tech-focused Technology Select Sector SPDR Fund ( NYSEARCA:XLK ), which delivered an annualized return of 15.9% over the same time span. Despite risks, SMH’s stock has compelling upside drivers. The ETF’s 25 holdings—concentrated yet diversified—tap into AI’s unstoppable rise. NVIDIA’s earnings could spark a rally, lifting SMH past resistance at $270-$283. TSMC’s production ramp-up and AMD’s data center gains add resilience. At 0.35% expense ratio and $307.23 billion average market cap, SMH offers cost-effective exposure to a sector poised for 9% quarterly growth. If macroeconomic conditions stabilize and AI investments accelerate, SMH’s stock could hit $400-$450 by late 2025, aligning with high-end forecasts and historical outperformance (e.g., 50%+ gains in 2023).