TSMC's Stock Skyrockets Amid AI Boom: Poised for Best Year Since 1999

TSMC's stock recently reached an all-time high, positioning the company for likely its best annual performance since 1999. On Tuesday, TSMC's shares in Taipei rose as much as 1.4%, briefly surpassing the previous peak from November 8th. This surge mirrors the overnight gains seen in U.S. chip stocks, including major TSMC client Nvidia, driven by investor enthusiasm for artificial intelligence-related transactions.

Year-to-date, TSMC's stock has appreciated more than 80%, underscoring the market's robust confidence in the semiconductor giant amidst the AI sector's rapid expansion. Investors remain optimistic about TSMC's positioning as a leader in providing technology solutions beneficial to AI advancements without needing to directly pick winners among emerging technologies.

Kevin Net, Head of Asian Equities at Financiere de L Echiquier, highlighted TSMC as an excellent choice for gaining a foothold in the AI theme at a reasonable valuation. Investors are advised to look for upcoming catalysts, such as Nvidia’s presentation at CES 2025 next month and TSMC's forthcoming performance reports and guidance.