We recently compiled a list of 20 trending AI stocks with latest news and valuations. In this article, we’ll take a look at how Taiwan Semiconductor Manufacturing Co., Ltd. (NYSE:TSM) stands compared to other trending AI stocks.
S&P 500 to reach 6,000 by year-end amid AI boom and revenue growth
Sanctuary Wealth’s Mary Ann Bartels, who appears on CNBC’s Squawk Box to discuss the latest market trends, remains bullish on 2024, predicting the S&P 500 will reach 6,000 by year-end. I am doing it. The chief investment strategist believes the market will remain elevated heading into November and December as the Federal Reserve recalibrates toward easy monetary policy and corporate profits continue to grow.
As of today, the S&P is about 3% away from hitting 6,000. This was just eight months after the number of visitors exceeded 5,000 for the first time. Monday, October 14th marked a new record for the S&P, marking the second anniversary of the bull market. The milestone represents a remarkable rebound over the past two years, when stocks soared despite continued recession fears and rising interest rates.
The S&P 500 Index’s new all-time high came amid optimism on Wall Street as the third-quarter earnings season began. Corporate profits have shown resilience amid high interest rates and moderate inflation, and investors are rushing into stocks that stand to benefit most from the generative AI craze. – Market sentiment remains bullish as traders expect strong financial results and continued growth in technology-driven sectors.
Artificial intelligence stocks are leading the rise in the S&P 500 and Nasdaq. On October 14, the S&P 500 and Dow Jones Industrial Average both hit record highs, declining 0.8% and 0.5%, respectively. Meanwhile, the Nasdaq rose 1%, nearing its own record. Despite this recent rally, high valuations appear to pose a challenge to continued growth, with analysts pointing out that this could be a sign that the bull market is nearing an end. are.
To learn more about these trends, visit Goldman Sachs’ 10 Unsexy AI Stocks and Goldman Sachs’ 10 Hottest AI Stocks.
Strategists also cautioned that continued gains will depend on identifying sectors with strong earnings growth. As artificial intelligence is poised to have a major impact on future market performance, the focus shifts to its impact on profitability across various industries. For AI to continue to drive market growth, “more companies need to realize the promise of AI through margin and profitability metrics,” said Scott Kronert, equity strategist at Citi. .
At the same time, it is also true that the ongoing conflict in the Middle East, the upcoming US presidential election, and natural disasters could pose risks to market upside. Nevertheless, ongoing AI innovations and a resilient economy support further gains. With this in mind, Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management, further commented on how third-quarter results will catalyze a market rally as investors focus on technology fundamentals and AI. It points out that there is a possibility that it will work.
“We continue to expect higher volatility in tech stocks in the near term. However, we remain positive on the outlook for the tech sector and artificial intelligence (AI). Against this backdrop, volatility should continue to rise. ” states the note. Leveraged to build long-term AI exposure. ”
The bank said October was a good month for tech stocks, citing that the Nasdaq 100’s monthly realized volatility over the past 40 years was 26% in October, compared to an average of 22% for other months. It was a historically tumultuous month. Either way, AI’s strong fundamentals and upcoming earnings season should reaffirm its positive growth trajectory.
Furthermore, it is stated that the overall AI semiconductor industry is expected to grow rapidly and reach $168 billion by the end of the year. Tech and AI companies are also expected to “beat and raise” expectations for the September quarter. Additionally, the continued shift to smaller and more powerful AI chips will significantly improve performance and encourage further investment in this area.
To learn more about these developments, visit BlackRock’s 30 Most Important AI Stocks and Beyond the Tech Giants: 35 Non-Technology AI Opportunities.
our methodology
In this article, we selected AI stocks by examining news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
Why are we interested in stocks that hedge funds invest in? The reason is simple. Our research shows that by mimicking the top stock picks of the best hedge funds, you can outperform the market. Our quarterly newsletter strategy selects 14 small- and large-cap stocks each quarter and has returned 275% since May 2014, outperforming the benchmark by 150 percentage points (Learn more ).
Close-up of a complex network of integrated circuits used in logic semiconductors.
Taiwan Semiconductor Manufacturing Co., Ltd. (NYSE:TSM)
Number of hedge fund holders: 156
Taiwan Semiconductor Manufacturing Co., Ltd. (NYSE:TSM) is a Taiwanese multinational semiconductor contract manufacturing and design company. The company is a leading manufacturer of advanced chips used in artificial intelligence applications. The world’s largest contract chipmaker is benefiting from the surge in AI, with third-quarter profits expected to rise 40%.
According to SmartEstimate, TSM’s net profit was estimated at NT$298.2 billion, or the equivalent of US$9.27 billion, at the end of the third quarter. The company is benefiting from the AI boom, as major technology customers such as Apple, Nvidia, AMD, Qualcomm, and Mediatek rely heavily on its technology. As a result, TSM’s stock price soared. The company is also expanding its global footprint, including building a new factory in Arizona that is expected to cost $65 billion, and plans to expand into Europe.
TSM ranks #2 overall on the Trending AI Stocks list for Latest News and Ratings. While we see TSM’s potential as an investment, we believe some AI stocks are more likely to deliver higher returns, and within a shorter time frame. If you’re looking for AI stocks with more promise than TSM, but trading at less than 5x earnings, check out our report on the cheapest AI stocks.
Read next: $30 trillion opportunity: 15 humanoid robot stocks to buy, according to Morgan Stanley and Jim Cramer, says NVIDIA has ‘become a wasteland.’
Disclosure: None. This article was originally published on Insider Monkey.
