Hot or Not, Stock Market Edition: 07/31/2026

Happy Friday. Here are the stock stories we're following today:

• Hot: Electronics manufacturing powerhouse Sanmina (SANM) is cashing in on the AI buildout after a Q3 beat; semiconductor foundry giant United Microelectronics (UMC) is gaining serious momentum
• Not: Cloud security provider Zscaler (ZS) has lost its shield; AI chip startup Blaize Holdings (BZAI) is running out of runway

P.S. For more stocks making moves, check out our Zen Ratings Upgrades & Downgrades screener.

🔥 HOT: Semiconductor foundry giant United Microelectronics (UMC) is a reminder that the chip boom extends well beyond the household names. Taiwan's second-largest chipmaker just began mass production at its new Singapore fab, a move that prompted Citi to flag an improving outlook, and it has also hit a manufacturing milestone in silicon photonics and launched its next-generation smartphone display platform. Q1 EPS more than doubled year over year, and the market has responded emphatically, sending shares over 140% in the past 12 months.

Yet signs point to continued performance. UMC earns a B (Buy) Zen Rating, a tier that has historically returned over 17% annually against roughly 11% for the S&P 500, and it comes with an unusual double-A: an A for Momentum alongside an A for Safety, backed by B grades for Value and Sentiment, all inside the A-rated Semiconductor industry. That combination describes a stock in a powerful uptrend that's also steadier than its high-flying peers — a genuinely rare pairing in semis, and a quieter way to play the cycle. 

🥶 NOT: AI chip startup Blaize Holdings (BZAI) shows how brutally the market punishes broken SPAC stories. The stock has given up nearly 90% from its 52-week high, now sitting right at its low and trading under a dollar, while a steady stream of law firms investigates securities class-action claims. The financials explain the exodus: roughly $40 million in trailing revenue against losses topping $80 million, a profit margin near negative 200%, and cash reserves our checks flag as insufficient for the coming year's projected burn. Three analysts still carry Strong Buy ratings with targets implying over 500% upside, but those calls were made months ago, and the market has voted against them every day since. 

The ratings could hardly be more severe. BZAI holds an F (Strong Sell), a tier that has historically lost nearly 13% a year, and ranks dead last at #181 of 181 in its industry. Five components fail outright — Value, Momentum, Safety, Financials, and AI — flagging an unsupportable price, a collapsing trend, and a balance sheet running on empty. When a company sits at the very bottom of an otherwise B-rated industry, the trouble is clearly its own rather than the sector's. Blaize may have a real AI story to tell one day, but with cash dwindling and lawyers circling, this is a falling knife best left alone. 

🔥 HOT: Electronics manufacturing powerhouse Sanmina (SANM) is turning the AI infrastructure buildout into real results. Q3 came in ahead of estimates on both earnings and revenue as AI demand surged, and management raised full-year fiscal 2026 guidance. EPS is forecast to roughly double to above $11 next year and earnings growth is projected over 50% annually, comfortably ahead of the industry pace. Yet the recent selloff has led to the stock dipping considerably. 

That retreat may be the setup: The ratings support the case. SANM holds an A (Strong Buy) Zen Rating, the top tier, which has historically returned over 28% per year — nearly triple the S&P 500 — and ranks #2 of 33 in the A-rated Electronic Component industry. Looking at the Component Grades, an A for Growth reflects that accelerating earnings power, while B grades for Value and Sentiment point to a price that hasn't kept up and analysts warming to the name. A beat, a guidance raise, and a discount to fair value make this one of the more compelling entry points in the AI supply chain right now. 

🥶 NOT: Cloud security provider Zscaler (ZS) has fallen from cybersecurity darling to cautionary tale. Shares are down over 50% from their 52-week high, among the sharpest one-year declines anywhere in enterprise software, and the news flow has turned hostile as multiple law firms open shareholder investigations into potential securities claims. The reset isn't finished either: even after that collapse, a DCF model still calls the stock roughly 10% overvalued, the company operates at a net loss, and revenue growth is expected to trail its own industry average. Insiders, the CFO among them, have been selling steadily throughout the decline. 

The ratings counsel patience rather than bargain-hunting. ZS sits at a C (Hold), a middling tier that has historically delivered just over 5% a year, less than half the S&P 500's pace. Digging into the Component Grades, a D for Momentum captures the broken price trend. Zscaler may work its way back, but with legal clouds gathering and its less-than-stellar quant trade, this belongs on a watchlist rather than in a portfolio.

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