TSMC Regains Top 10 Most Valuable Company Status on AI Boom

Taiwan Semiconductor Manufacturing Company (TSMC) has once again secured its position among the world's top 10 most valuable companies. This resurgence is fueled by the wave of optimism surrounding artificial intelligence (AI) that has propelled its stock to unprecedented heights.

A recent Bloomberg report indicates that TSMC experienced a remarkable 14% surge in its stock value last week. This rally boosted the chipmaker's market capitalization to a record high. Although the company saw a slight decrease of 2% in early trading on Monday, March 11, its market capitalization remains substantial at $634 billion.

Despite this minor setback, TSMC maintains a higher market share than Broadcom, according to the report.

Analysts Weigh In

Analysts from prominent financial institutions such as Morgan Stanley and JPMorgan Chase & Co. anticipate further growth for the semiconductor giant. Their optimism stems from the increasing revenue related to AI and the company's strong pricing power. TSMC boasts major players like Apple, Nvidia, and Qualcomm among its clientele.

"Generative AI semi is an obvious growth driver for TSMC," noted Charlie Chan and other Morgan Stanley analysts in a report released last week. They also highlighted that the company's international expansion efforts contribute to mitigating geopolitical concerns.

TSMC's revenue witnessed a substantial 9.4% increase in the first two months of 2024. This growth is attributed to the rising demand for high-end chips, which has been fueled by the surge in AI activity.

Nvidia's AI Boost

Nvidia has also experienced a surge in its stock value this year, driven by the frenzy surrounding generative AI.

Over the past month, Nvidia's stock price has increased by more than 20%. In the last six months, it has risen by over 90%. Furthermore, over the past year, Nvidia's stock price has appreciated significantly, jumping from $234.36 per share to $875.28 per share – marking an impressive 275% increase.