Taiwan Semiconductor Manufacturing (TSM) shows significant growth potential due to increasing demand for AI chips

From Nasdaq: 2024-08-25 03:51:00

Over the past five years, Taiwan Semiconductor Manufacturing (NYSE: TSM) has shown significant growth, up over 2,900%. As the largest semiconductor contract manufacturer globally, TSMC plays a key role in the AI infrastructure buildout. With increasing demand for cutting-edge AI chips, TSMC is well positioned to see further growth and potentially raise prices next year.

TSMC boasts strong revenue growth, with second-quarter revenue up 33% to $20.8 billion. The company is also considering price hikes on its more advanced technologies, projecting an increase of 10-11% for 4 nanometer and 5nm wafers, and 4% for 3nm technology. With increasing capacity, TSMC is set to perform even better next year.

As AI technology advances, the need for more computing power and chips grows. TSMC is in a prime position to benefit from this trend, as indicated by major cloud computing companies like Meta Platforms. Trading at an attractive forward P/E ratio and PEG ratio, TSMC offers a strong investment opportunity for those looking to capitalize on the AI infrastructure buildout.



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