TSMC Regains Top 10 Global Value Ranking Amid AI Boom

Taiwan Semiconductor Manufacturing Company (TSMC) has surged back into the ranks of the world's 10 most valuable companies, fueled by the ongoing artificial intelligence (AI) revolution within the tech industry. This resurgence is driven by soaring stock prices that have reached record highs.

According to a Bloomberg report, TSMC shares rallied by 14% the previous week, pushing the chipmaker's market capitalization to unprecedented levels. Although a slight dip of 2% occurred in early trading on Monday, March 11th, the company's market capitalization remained strong at $634 billion.

The report highlights that this minor setback did not significantly impact the company, as its market share continues to surpass that of Broadcom.

Expert Analysis

Analysts at prominent firms like Morgan Stanley and JPMorgan Chase & Co. anticipate further growth for the semiconductor giant, whose clientele includes industry giants such as Apple, Nvidia, and Qualcomm. This positive outlook is attributed to the escalating revenue generated from AI-related applications and the company's robust pricing power.

In a note released last week, Morgan Stanley analysts, including Charlie Chan, emphasized that "Generative AI semi is an obvious growth driver for TSMC." They also noted that the company's international expansion efforts are helping to alleviate geopolitical concerns.

Strong Revenue Growth

TSMC experienced a substantial 9.4% increase in revenue during the first two months of 2024. This growth is directly linked to the heightened demand for high-end chips, spurred by the surge in AI-related activities.

Nvidia's AI-Driven Ascent

TSMC isn't the only chip company experiencing significant stock appreciation this year. Nvidia has also benefited immensely from the generative AI frenzy.

Over the past month, Nvidia's stock price has climbed by over 20%. Looking at a longer timeframe, the stock has risen by more than 90% in the last six months. Impressively, over the past year, Nvidia's stock price has skyrocketed from $234.36 per share to $875.28, marking an extraordinary 275% increase.