TSMC: A Cheaper Way to Invest in the Booming AI Chip Market
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TSMC plays a vital role in manufacturing AI chips designed by companies like Nvidia. It is a cheaper way to invest in the AI chip market vs buying Nvidia stock.
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TSMC stock trades at a P/E ratio of 19, much lower than Nvidia's 65 trailing P/E ratio. It offers better value.
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Demand for TSMC's advanced 5nm and 3nm chips from AI chipmakers is booming. Its CoWoS packaging capacity for AI chips is expected to jump 130% in 2024.
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TSMC's revenue and earnings growth are expected to accelerate significantly in 2024 and beyond thanks to strong demand for its advanced chips from the AI market.
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TSMC stock could surge 58% in the next 2 years based on projected earnings growth. But it could go even higher if awarded a higher earnings multiple closer to other tech stocks.