Israel’s Phoenix Financial Exits $169 Million Tower Semiconductor Stake After Stock's 99% Rally

On Monday, Israel-based Phoenix Financial disclosed that it sold out of Tower Semiconductor (NASDAQ:TSEM), liquidating nearly 3.7 million shares for an estimated $169.5 million in the third quarter.

What Happened

Phoenix Financial disclosed in a filing with the U.S. Securities and Exchange Commission (SEC) released on Monday that it sold out of Tower Semiconductor during the third quarter. The move involved selling nearly 3.7 million shares, with an estimated transaction value of $169.5 million based on the average price over the quarter. The fund reported holding zero shares at quarter-end.

What Else to Know

Top holdings after the filing:

• NASDAQ:ACWI: $897.6 million (7.3% of AUM)
• NYSE:TEVA: $834.2 million (6.8% of AUM)
• NASDAQ:MSFT: $698.4 million (5.7% of AUM)
• NYSEMKT:RSP: $670.9 million (5.5% of AUM)
• NASDAQ:NVDA: $598.4 million (4.9% of AUM)

As of Monday, shares of Tower Semiconductor were priced at $83.16, up a staggering 99% over the past year and well outperforming the S&P 500's nearly 20% gain over the same period.

Company Overview

Company Snapshot

Tower Semiconductor is a leading independent foundry specializing in advanced analog and mixed-signal semiconductor manufacturing. The company leverages proprietary process technologies to support a broad range of applications and end markets, enabling customers to bring differentiated products to market. It operates as an independent semiconductor foundry, generating revenue primarily from wafer fabrication services and design enablement platforms for integrated device manufacturers and fabless companies.

Tower serves diverse end markets such as consumer electronics, communications, automotive, industrial, aerospace, military, and medical device sectors across the United States, Japan, other Asian countries, and Europe.

Foolish Take

Phoenix Financial's full exit from Tower Semiconductor marks a significant portfolio rotation for Phoenix, which manages over $160 billion in assets and remains one of Israel’s largest investment firms. The exit comes after Tower’s 99% share price rally over the past year, driven by stronger foundry demand from AI and RF infrastructure markets. Despite the surge, the stock still trades well below dot-com era highs.

Tower reported second-quarter revenues of $372 million, up 6% year-over-year, with CEO Russell Ellwanger highlighting momentum from data center and AI-related growth. For Phoenix, known for active capital deployment and rebalancing across public and private markets, the sale likely reflects profit-taking following a prolonged recovery, rather than a shift in confidence toward the semiconductor sector.

So what should long-term investors take away? Ultimately, Tower’s fundamentals remain solid. Its leadership in analog and mixed-signal chips—coupled with high free cash flow and a strong AI tailwind—suggests the company could continue boosting earnings as semiconductor demand stabilizes globally.

Glossary

Exited position: When an investor sells all shares of a particular holding, fully closing out their investment.
AUM (Assets Under Management): The total market value of assets a fund or investment manager oversees on behalf of clients.
Liquidated: Sold off an asset or position, converting it into cash.
Stake: The ownership interest or amount of shares held in a company or investment.
Analog-intensive mixed-signal semiconductor: Chips that process both analog and digital signals, often used in complex electronic devices.
SiGe: Silicon-Germanium, a semiconductor material used for high-speed and radio-frequency applications.
BiCMOS: A technology combining Bipolar and CMOS transistors on a single chip for improved performance.
RF CMOS: Radio Frequency CMOS, a technology for making chips that handle wireless signals.
CMOS image sensors: Devices that convert light into electronic signals for cameras and imaging equipment.
MEMS: Micro-Electro-Mechanical Systems, tiny mechanical devices built onto semiconductor chips.
Foundry: A company that manufactures semiconductors for other firms, rather than designing its own products.
TTM: The 12-month period ending with the most recent quarterly report.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.