Nvidia Supplier Taiwan Semi Rides AI Wave to Record Rally, Sidestepping Geopolitical Concerns
Portfolio Pulse from Anusuya Lahiri
Taiwan Semiconductor Manufacturing Co (TSMC) (NYSE:TSM) is experiencing a significant stock rally, driven by the AI boom and holding over a 90% market share in advanced semiconductors for AI. Despite geopolitical tensions and concerns about the sustainability of AI-driven demand, TSMC's revenue increased by 9.4% in the first two months of the year. The company is diversifying its manufacturing locations to address market concerns. TSMC stock has gained 35% year-to-date, with exposure available through VanEck Semiconductor ETF (NASDAQ:SMH) and iShares Semiconductor ETF (NASDAQ:SOXX).
March 18, 2024 | 12:06 pm
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NEUTRAL IMPACT
Apple Inc's slowing iPhone sales are compensated by the surge in AI activities, impacting TSMC's revenue positively.
Apple Inc's slowing iPhone sales have been a concern, but the surge in AI activities, which TSMC is heavily involved in, compensates for this, mitigating any negative impact on TSMC's revenue.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 60
POSITIVE IMPACT
Nvidia Corp's success as a crucial client of TSMC further fuels TSMC's stock rally, with Nvidia gaining 82% YTD.
Nvidia Corp's success significantly contributes to TSMC's stock performance, as Nvidia's advancements in AI and its 82% YTD gain highlight the symbiotic relationship between the two companies.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
POSITIVE IMPACT
Investors can gain exposure to TSMC's stock rally through the VanEck Semiconductor ETF, which includes TSMC in its holdings.
The VanEck Semiconductor ETF offers investors a way to participate in TSMC's growth, as it includes TSMC among its holdings, benefiting from the AI boom.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
iShares Semiconductor ETF provides another avenue for investors to benefit from TSMC's performance in the semiconductor and AI markets.
The iShares Semiconductor ETF, which includes TSMC in its portfolio, allows investors to capitalize on the semiconductor industry's growth, particularly TSMC's leading role in AI.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
TSMC's stock rally is driven by the AI boom and its dominance in advanced semiconductors, with a 35% YTD gain despite geopolitical concerns.
TSMC's significant market share in advanced semiconductors for AI and its strategic diversification of manufacturing locations contribute to its stock rally, despite concerns about the sustainability of AI-driven demand and geopolitical tensions.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100