Investors should consider investing in chip companies like TSMC and ASML for AI growth.

From Nasdaq: 2025-02-23 07:00:00

Investors should consider the chip market when thinking about AI investing. Taiwan Semiconductor (TSM) and ASML (ASML) are key players in supplying chips for AI models, with TSMC projected to grow revenue at a 45% CAGR over the next five years. ASML’s machines are essential for high-end chip manufacturing, despite regulatory restrictions on sales to China.

Both TSMC and ASML are strong buys now, with TSM trading at 22 times forward earnings and ASML at 30 times forward earnings. While TSMC offers growth potential at a discount price, ASML’s technological monopoly status justifies its stock price. Investors are advised to take advantage of the current stock prices and hold onto these companies for long-term growth in the chip market. Investing in Nvidia, Apple, and Netflix years ago would have yielded significant returns. Nvidia saw a return of $348,579 from a $1,000 investment in 2009, Apple $46,554 from 2008, and Netflix $540,990 from 2004. “Double Down” alerts are being issued for these companies now. Keithen Drury holds positions in ASML, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends and holds positions in ASML, AMD, Apple, Nvidia, and Taiwan Semiconductor Manufacturing.



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