Ready to Invest in Artificial Intelligence (AI)? 2 Nvidia Alternatives

The broad surge of interest in artificial intelligence (AI) has been boosting the stock market for more than a year now, stretching back to OpenAI’s release of the ChatGPT chatbot in November 2022.

Since then, a handful of early leaders in AI technology have soared into the stratosphere. AI accelerator chips drove Nvidia‘s stock more than 410% higher in 16 months. High-performance computer systems builder Super Micro Computer rose even faster with a 1,100% gain over the same period.

I understand if you hesitate to buy shares in these skyrocketing AI stocks. What goes up must not necessarily come back down quickly, but the valuation risk is real.

Don’t worry, though. There are many ways to tap into the AI boom without relying on the most obvious (and perhaps overvalued) market darlings.

Right now, I see deep value and exciting AI-driven growth in the next few years for Google parent Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and chip manufacturer Taiwan Semiconductor Manufacturing (NYSE: TSM).

Taiwan Semiconductor: Delivering AI chips to a hungry world

The demand for AI-driven computing power is skyrocketing. Taiwan Semiconductor, or TSMC for short, is at the heart of this technological shift.

In January’s fourth-quarter earnings call, CEO C.C. Wei pointed out that more complex AI software requires more raw computing power, so the demand for faster and more energy-efficient chips should keep rising over time. As an industry-leading provider of advanced manufacturing technologies, Wei’s company is poised to benefit from this massive demand surge for years to come.

“The value of TSMC’s technology position is increasing, and we are all well positioned to capture the major portion of the market in terms of semiconductor components in AI,” Wei said.

Wei’s analysis highlights TSMC’s strategic position to make the most of the ongoing explosion in AI applications. Although its stock performance has been decent, with a roughly 70% rise since November 2022, TSMC’s crucial role in…