Following Morgan Stanley’s upward adjustment of Nvidia’s price target, Taiwan Semiconductor Manufacturing Company (TSMC) saw its shares soar to unprecedented levels on Thursday.
This surge was attributed to the sustained rise in demand for AI technologies. As the leading global producer of advanced processors, TSMC supplies chips to major players like Nvidia and Apple.
Morgan Stanley’s decision to raise Nvidia’s price target from $603 to $750 on February 7 reflects its optimistic outlook for the company’s immediate future.
TSMC’s shares commenced trading on Thursday at a peak of 709 New Taiwan dollars, closing at NT$697, marking an almost 8% increase from its previous close on February 5.
This notable performance coincided with the resumption of trading on the Taiwan Stock Exchange following the Chinese New Year holiday.
Nvidia stands out as one of the primary beneficiaries of the AI surge, which gained momentum last year, particularly fueled by heightened interest in generative AI following the debut of OpenAI’s ChatGPT in November 2022.
ChatGPT rapidly gained popularity for its ability to generate responses resembling human speech based on user inputs. Significant computational resources, particularly graphics processing units (GPUs), are essential for training large language models like ChatGPT.
These chips must possess substantial processing power to swiftly analyze terabytes of data and identify intricate patterns.
Nvidia’s GPUs play a pivotal role in both training and executing ChatGPT, with the model relying on thousands of these GPUs for its operations.
In their February 7 client report, Morgan Stanley analysts highlighted the significance of the “B100 transition” as a crucial near-term driver.
This transition impacts H100 lead times and competitive dynamics, underscoring its importance in the evolving landscape of AI and chip technology.
Analysts anticipate Nvidia’s B100 GPU to revolutionize the AI landscape, surpassing even the capabilities of its H100 AI processor. TSMC is presently manufacturing 3-nanometer chips and is slated to commence mass production of 2-nanometer chips in 2025.
In chip technology, the term “nanometer” denotes the size of individual transistors. Smaller nanometer sizes generally result in more potent and efficient chips, as they enable the packing of more transistors onto a single chip.
Additionally, shares in Taiwan’s Orient Semiconductor Electronics Ltd surged by 10% on Thursday.
