The past six months have been pleasant ones for Taiwan Semiconductor Manufacturing Company (NYSE:TSM), as it continues to reap the benefits of being the top global semiconductor manufacturer.
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That’s not to say that there haven’t been some bumps and bruises along the way, many of which were connected to global geopolitics and trade uncertainties. Indeed, TSM’s share price rolled downhill during the winter months, as the markets worried about the growing tensions between the U.S. and China.
The spring and summer seasons have been much kinder to TSM investors, as the continued hyperscaler buying spree has provided TSM with no shortage of tailwinds (and revenues).
As a case in point, the company demonstrated a stellar quarter with its last earnings release. Q2 2025 revenues of $30.07 billion in U.S. dollars represented a 44.4% year-over-year increase, while its gross margin was 58.6%.
The company’s share price has been a reflection of this bullish picture, and it has practically doubled in value since hitting a post-Liberation Day trough in early April.
After this bull run, however, has it become too late to hop on board the TSM bandwagon? Top investor Stefon Walters doesn’t think so.
“There’s one key reason the rally may continue: the expected spending on artificial intelligence (AI) infrastructure in the coming years,” predicts the 5-star investor, who is among the top 2% of stock pros covered by TipRanks.
The company is making a killing on its AI chips, notes Walters, with 60% of its Q2 revenues coming from its high-performance computing segment. The investor further details that “nearly all” of the AI chips that have been used to build out data center infrastructure come from TSM.
In other words, continued hyperscaler spending bodes quite well for the TSM. On that note, Walters points out that Nvidia is expecting between $3 to $4 trillion in infrastructure spending through the end of the current decade.
“As the undisputed leader in chip manufacturing — which is critical to training AI models — TSMC can expect a good amount of this to trickle down into its business in some form or fashion,” adds Walters. (To watch Stefon Walters track record, click here)
For its part, Wall Street seems pretty gung ho about TSM. With 7 Buys and 1 Hold, TSM coasts to a Strong Buy consensus rating. Its 12-month average price target of $285.50 has an upside of ~5%. (See TSM stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.