This article first appeared on GuruFocus.
Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) shares advanced by the most since April, reaching a new record in Taipei as optimism around artificial intelligence demand carried into the start of the year. The world’s largest contract chipmaker rose as much as 6.9% after Goldman Sachs lifted its price target by 35% to NT$2,330, reflecting expectations for another year of solid growth. The move underscored TSMC’s importance as a key supplier to Nvidia and Apple, while helping lift Taiwan’s Taiex more than 3% to a record above 30,000, a level officials said recently had appeared difficult to envision.
Strength in TSMC fed into a broader rally across Asian semiconductor stocks as investors continued to add exposure to the AI theme, even as some concerns about overheating and short-term volatility lingered following recent US strikes against Venezuela. Samsung Electronics (SSNLF) extended gains for a fifth consecutive session ahead of preliminary results expected later in the week, which are likely to offer fresh insight into whether earnings can support recent share-price momentum. In Japan, Tokyo Electron and Advantest each climbed more than 7%, while Chinese chip stocks moved higher after the country’s integrated circuit investment fund increased its stake in Semiconductor Manufacturing International Corp. and as attention grew around more efficient AI training approaches highlighted by DeepSeek.
Investor confidence in TSMC’s position within the AI supply chain has continued to build, with the shares up 44% in 2025 and the company’s market value rising above $1 trillion for the first time. Goldman analysts described AI as a multi-year growth engine for the company, pointing to improving profit margins even as projected capital spending could reach $150 billion over the next three years to expand capacity. Other analysts have suggested this year remains heavily centered on AI, while encouraging investors to focus on quality amid bubble concerns, with near-term attention also on TSMC’s Jan. 15 earnings report and a wave of planned Hong Kong listings by AI-related companies that could raise as much as $4.1 billion.