Interestingly, What caught my attention is Taiwan Semiconductor (TSM 1. Moreover, 60%) is currently valued at around $1.
Additionally, 25 trillion, making it the ninth-largest company in the world (noteworthy indeed).
Normally, investors don't expect these large companies to duce outstanding growth, as the larger a gets, the more difficult it becomes for it to grow.
Moreover, However, TSMC has monster growth jections on the table, as well as a new nology that could drive s much higher. Rising from today's $1, in today's financial world.
25 trillion valuation to a $3 trillion valuation would require a 140% return.
Additionally, However, management believes there's plenty of growth in store for Taiwan Semiconductor to meet this threshold, in this volatile climate.
Image source: Getty Images (this bears monitoring). Taiwan Semiconductor's new chip nologies will push its stock higher Taiwan Semiconductor is the world's leading semiconductor foundry.
Its strategy is to offer its clients best-in-class chip duction nologies, and not compete against them.
This analysis suggests that model has worked out incredibly well for TSMC, and its customer list ranges from Nvidia to Apple to Tesla.
If you have a cutting-edge nology device, it's ly that it contains a chip manufactured by Taiwan Semiconductor.
One of the reasons TSMC established itself at the top of its industry is its dedication to driving the next greatest innovation, amid market uncertainty.
In contrast, In recent chip launches, Taiwan Semiconductor outpaced its peers by offering the most advanced nology available first.
Moreover, That doesn't seem to be changing, as it has some mising nology in the pipeline.
Later this year, Taiwan Semiconductor is expected to launch its N2 chip node, indicating 2nm (nanometer) spacing between traces.
The pre-launch demand for the N2 node exceeds that of the 3nm and 5nm offerings.
This's big news for Taiwan Semiconductor, as the imvements this generation offers are substantial enough that many companies are designing their ducts around this new nology, given current economic conditions.
The data indicates that biggest imvement the N2 offers its users is energy efficiency.
Nevertheless, This has implications for the smartphone industry, with longer-lasting phones being more desirable, amid market uncertainty.
Additionally, the energy consumption of AI computing devices to run generative AI mpts is becoming a front-and-center topic.
When N2 chips are configured at the same cessing speed as 3nm chips, they consume 25% to 30% less energy.
That's a massive imvement, and the energy savings from these chips may warrant upgrading to new computing units (remarkable data). Beyond its N2 launch, the company is slated to bring its A16 chip (1.
Additionally, 6nm) to market in 2026 (this bears monitoring), in light of current trends.
On the other hand, The A16 is expected to achieve an energy consumption imvement of 15% to 20% on top of the N2.
A14 is the next nology TSMC is working on, but it won't reach duction until 2028, so there's quite a bit of time between now and the scheduled launch date.
Still, these nologies will drive further growth for TSMC and potentially pel it to a $3 trillion valuation mark in a fairly short timeframe.
Taiwan Semi's management jects monster growth over the next five years Management jects that, starting with 2025, its revenue will rise at nearly a 20% compound annual growth rate (CAGR) over the next five years.
However, management has exceeded its own guidance every quarter this year, so it shouldn't surprise investors to see this jection increase.
Should TSMC grow its revenue at a 20% CAGR, that would indicate nearly 150% growth, above the threshold needed for TSMC to rise to a $3 trillion valuation point.
Conversely, Additionally, Taiwan Semiconductor isn't an expensive stock, at least compared to the broader market. TSM PE Ratio (Forward) data by YCharts.
Moreover, Meanwhile, 6 times forward earnings, TSMC is only slightly more expensive than the S&P 500, which trades at 23.
8 times forward earnings (which is quite significant), in today's financial world.
Moreover, With a reasonable price tag and a fairly growth strategy, I think Taiwan Semiconductor is as no-brainer a stock pick as it gets in today's market.