Taiwan Semiconductor (TSMC) is the leading player in the global chip manufacturing industry, holding about 67% of the market and 90% of advanced chip production, with revenues doubling to $95 billion by March 2025, driven by the AI boom and high demand for NVIDIA GPUs.

TSMC supplies chips for high-end smartphones, 5G infrastructure, and is advancing its technology with plans to produce 2nm chips by late 2025 and 1.4nm chips by 2028, aiming for significant improvements in speed and energy efficiency.

The company is expanding its manufacturing capacity with new facilities, including a third fab in Phoenix, Arizona, to meet growing demand, especially from AI applications.

TSMC plays a central role in the AI economy, providing chips for major companies like NVIDIA, AMD, and Apple, with analyst confidence reflected in rising EPS estimates and a strong Zacks Rank of #1 (Strong Buy).

NVIDIA's market cap is approaching $4 trillion, fueled by surging demand for GPUs used in AI, with the 'ChatGPT moment' in 2023 catalyzing massive growth in AI applications and data center investments expected to surpass $1 trillion by 2028.

The growth of AI, driven by NVIDIA and others, is creating a significant demand for high-performance chips, reinforcing the AI bubble's expansion.

TSMC's upcoming production of 2nm chips by late 2025 and 1.4nm chips by 2028 promises substantial gains in speed and energy efficiency, with recent revenue estimates indicating strong growth prospects for 2025 and 2026.

TSMC holds approximately 67% of the global foundry market and 90% of advanced chip manufacturing, with analyst confidence high as reflected in rising EPS estimates and a current Zacks #1 Rank.

Q1 2025 earnings estimates for TSMC have increased, with projections of 32% revenue growth to over $117 billion and EPS of $9.28, highlighting strong investor confidence in the AI-driven chip industry.

Cloudflare's revenue grew nearly 29% to $1.67 billion in 2024, serving over 237,000 customers worldwide, but faces stiff competition from Cisco, Oracle, and other cloud providers.

Despite its growth, Cloudflare's valuation appears stretched, with high valuation metrics of 27x sales and over 200x EPS, leading to a Zacks Rank #3 (Hold) and concerns about earnings momentum.