AI Investment Surge: Three Stocks Poised for Long-Term Growth
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The artificial intelligence (AI) revolution is driving unprecedented demand for specialized hardware, creating a fertile landscape for investors. While much attention focuses on AI software and applications,the companies building the foundational infrastructure – the chips and networks that power AI – are positioned for significant,sustained growth. Three companies stand out as compelling buy-and-hold investments through 2035: Nvidia, Broadcom, and taiwan Semiconductor Manufacturing.
The AI buildout is not a fleeting trend; it represents a fundamental shift in computing, impacting nearly every sector. These three companies aren’t simply benefiting from the current hype cycle, but are integral too the continued expansion and evolution of AI capabilities, making them potentially lucrative long-term holdings.
1.Nvidia
Nvidia (NVDA) has become synonymous with AI, largely due to its graphics processing units (GPUs) which are ideally suited for the parallel processing demands of machine learning. The company’s dominance in this space continues to expand, with revenue climbing 26% to $22.1 billion in the most recent quarter.
Nvidia isn’t solely reliant on GPUs, though. It’s also leveraging its technology in data center networking, utilizing both its own chips and those from Broadcom to create comprehensive AI platforms. This strategic diversification further solidifies its position as a key player in the AI ecosystem.
2. Broadcom
Broadcom (AVGO) is a critical, yet often overlooked, component of the AI infrastructure. The company designs, develops, and supplies a broad range of semiconductor and infrastructure software solutions. Broadcom’s networking chips are essential for the high-speed data transfer required by AI systems,and it increasingly works alongside Nvidia,using both Nvidia and Broadcom chips,and in a different manner,to fuel their AI platforms.
This has translated into remarkable financial results. Broadcom’s AI revenue climbed 63% to $5.2 billion recently, with expectations of $6.2 billion in the coming quarter. The momentum is expected to continue as the need for chips and networking explodes higher,making Broadcom a smart long-term AI investment.
3. Taiwan semiconductor Manufacturing
While companies like Nvidia and Broadcom design the chips, Taiwan Semiconductor Manufacturing ((TSM) is the manufacturer that brings those designs to life.TSMC produces chips for AI leaders like Nvidia, allowing them to capitalize on innovation and demand.
TSMC benefits from demand across the entire chip industry, scoring multiple wins as the AI boom continues. gains in AI infrastructure spending should supercharge growth at the manufacturer, as chips are essential to powering any AI platform. TSMC has already seen revenue explode in recent years, and further gains are likely.
Trading at 28x forward earnings estimates, TSMC looks like a fantastic stock to buy and hold until 2035 as AI infrastructure spending fuels growth.
TSM Revenue (Annual) data by YCharts
