Analyst Daniel Sparks suggests investing in TSMC, which manufactures advanced chips for major AI companies, rather than betting on individual chip design firms. This recommendation comes as AI chip stocks like Micron Technology, Broadcom, and NVIDIA have recently experienced significant declines. Micron is down approximately 32% over the past three weeks, Broadcom has retreated 24% from its 52-week high, and NVIDIA has declined about 12%.
TSMC's foundry position makes it a less volatile bet on AI compute demand, insulating it from individual chip designer performance swings.