We recently compiled a list of the AI news that made waves on the internet this week, and in this article, we’ll take a look at how Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stands in comparison to other AI stocks that made waves on the internet this week.
Artificial intelligence is becoming increasingly essential for large enterprises by providing tools that drive efficiency, innovation, and competitive advantage. As AI technology continues to evolve, its importance to large enterprises is underscored by significant investments and impressive benefits. For example, AI’s ability to automate and optimize business processes is one of the most important benefits for large enterprises. AI-driven automation streamlines supply chain management, optimizes logistics, and improves customer service through chatbots and personalized recommendations. According to a McKinsey report, companies that make the most of AI can see a 20-25% increase in cash flow.
For more on these trends, check out “The 33 Most Important AI Companies to Watch” and “10 AI Stocks That Could Soar.”
In financial services, AI is transforming risk management, fraud detection, and customer insights. For example, JPMorgan Chase is using AI to review legal documents; a task that previously took thousands of manual hours now takes just seconds. In the pharmaceutical industry, AI is accelerating the drug discovery process. For example, companies like Pfizer are using AI to analyze massive data sets and identify potential drug candidates much faster than traditional methods. This not only shortens the time to market for new drugs, but also significantly reduces research and development costs, which are estimated to average approximately $2.6 billion per drug.
Additionally, AI has enabled businesses to provide more personalized experiences to their customers. Retail giants such as Amazon and Walmart use AI algorithms to analyze customer behavior and preferences to customize recommendations that improve shopping experiences and drive sales. Amazon’s AI-powered recommendation engine accounts for 35% of the company’s total sales. NVIDIA, a leader in AI hardware, is a great example of how AI can drive business success. In the second quarter of fiscal 2025, the company reported revenue of $30 billion, a figure that was heavily contributed to by AI. The company’s GPUs are the backbone of AI models used in a variety of industries, from autonomous vehicles to big data analytics, demonstrating the critical role AI plays in both revenue generation and technological advancement.
The story continues
For more on these developments, see “Billionaire Stan Druckenmiller Invests in AI Infrastructure, Tobacco, Industrial Stocks” and “10 Tech Stocks to Watch Amid Market Volatility, Bernstein Analysts Say.”
Our Methodology
In this article, we look at AI stocks that have been trending this week. These stocks are also popular among hedge funds. Why are we interested in the stocks that hedge funds are flocking to? The reason is simple: our research shows that you can outperform the market by mimicking the top picks of the best hedge funds. Our quarterly newsletter strategy selects 14 small and large stocks each quarter, and has returned 275% since May 2014, beating its benchmark by 150 percentage points (more here).
A close-up of the complex network of integrated circuits used in logic semiconductors.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of hedge fund holders: 156
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) manufactures and sells integrated circuits and semiconductors. EU authorities recently approved the construction of a new chip factory in the German city of Dresden. The factory is a joint venture between TSM and a German company and will cost $5.5 billion. The project aims to meet the demand for automotive and industrial applications on the continent. When completed, the facility will be the first of its kind in Europe. Currently, there are no comparable mass production factories that cater to the specific technological capabilities offered. The foundry will produce high-performance chips based on 300mm silicon wafers with 28/22nm and 16/12nm technology nodes.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) will operate the foundry, which is expected to be fully operational by 2029, producing 480,000 silicon wafers per year. Approval for the factory was granted by EU regulators under the European Chip Act, a €43 billion chip bill announced last year to support local chip manufacturing.
On our list of AI stocks that are trending on the internet this week, TSM ranks 13th overall. While we acknowledge the investment potential of TSM, we believe some AI stocks have the potential to deliver higher returns in a shorter time frame. If you are looking for AI stocks that are more promising than TSM but still trade at less than 5x TSM’s share price, check out our report on the cheapest AI stocks.
Read next: Michael Burry is selling these stocks and Jim Cramer is recommending these stocks.
Disclosures: None. This article was originally published on Insider Monkey.
