More Potential in 2 Tech Stocks Than Any Cryptocurrency

Following President Donald Trump’s election victory, the cryptocurrency market experienced a brief surge as some investors believed that his laxer regulations and open promotion of specific coins would cause many digital tokens to rise in value.

However, over the past few months, many cryptocurrencies have fallen due to the threat of tariffs, worries about a possible recession, and growing pessimism from some investors. While tech stocks have suffered the same fate, I think the long-term potential in tech stocks is higher and based on more concrete use cases.

Here are two tech stocks that could end up ahead of crypto’s gains in the coming years.

1. Taiwan Semiconductor Manufacturing

The world’s largest semiconductor manufacturer, Taiwan Semiconductor Manufacturing (TSM -6.02%), has already profited greatly from the spike in demand for chips due to artificial intelligence. Apart from its dominance in general chip manufacturing, it also produces an estimated 90% of AI processors worldwide.

The financial results from Taiwan Semiconductor’s chip-manufacturing advantage have been remarkable. In the fourth quarter, which concluded on December 31, the company’s sales increased 37% to $26.9 billion, while its diluted earnings per share increased 57% to $2.24 per American depositary receipt.

Though it’s way too soon to declare the artificial intelligence boom finished, there has been a lot of chatter recently about AI stocks declining. Both big and small IT companies are making significant investments in AI services and software, which will boost sales of cutting-edge chips for years to come.2 Tech Stocks Than Any Cryptocurrency

On the most recent earnings call, Taiwan Semiconductor CEO C.C. Wei stated, “Even after more than tripling in 2024, we forecast our revenue from AI accelerators to double in 2025 as the strong surge in AI-related demand continues.” Taiwan Semiconductor clearly believes this.

With Taiwan Semiconductor’s stock down 15% after the recent tech sell-off, the company’s shares are trading at a relative discount with a price-to-earnings ratio of 24.1, down from a P/E of 30 just six months ago.

2. Nvidia

Taiwan Semiconductor’s and Nvidia’s (NVDA -6.46%) long-term prospects are similar. Despite not producing semiconductors, Nvidia’s chip designs are used in some of the most cutting-edge AI systems available today.

Over the past few years, IT companies have been clamouring for access to Nvidia processors, and as a result, up to 95% of all AI chips in the world are Nvidia accelerators. Demand has increased Nvidia’s sales and profits, as seen by the 78% increase in sales to $39.3 billion in the fourth quarter and the 82% growth in diluted earnings per share to $0.89.

However, Nvidia is still reaping the rewards of all this AI demand. The demand for its Blackwell AI processors is “the fastest product ramp in our company’s history, unprecedented in its speed and scale,” according to management, who made $11 billion in sales in just one quarter, during the fourth-quarter results call.

The question of how quickly data centre spending will increase in the upcoming years is becoming more and more contentious. Sales and profits for Nvidia would undoubtedly suffer from a large slowdown in the purchase of cutting-edge processors by tech companies. But investors seem more worried about macroeconomic implications right now, such a recession, and are carrying over those concerns to the tech sector.

Tech companies might be impacted by a downturn in the economy, but it would be a mistake to concentrate too much on that and overlook the fact that artificial intelligence is still in its infancy. According to PwC, artificial intelligence could boost the world economy by $15.7 trillion by 2030. To meet these targets, IT businesses would require ever-more-advanced processors.

Therefore, even if a brief economic slowdown occurs, Nvidia still has a huge opportunity in the years to come. It also implies that investors’ perception of Nvidia’s long-term prospects may be hampered by present concerns.

Tech is more tangible than crypto

I think there are some legitimate reasons for investors to own cryptocurrencies, but Taiwan Semiconductor and Nvidia offer investors a much more grounded investment as these two leading tech companies help build an AI future. Nothing is guaranteed, of course. But while many cryptocurrencies are still very speculative, artificial intelligence is already well-established and technology companies will continue to build their companies around it for years to come.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Take into account this before purchasing Taiwan Semiconductor Manufacturing stock: The analysis team at Motley Fool Stock Advisor has determined the top ten stocks that investors should purchase right now. and one of them was not Taiwan Semiconductor Manufacturing. In the upcoming years, the ten stocks that slashed could yield enormous rewards.

Think back to December 17, 2004, when Netflix was listed. If you had invested $1,000 at the time of our recommendation, you would now have $504,518!
Alternatively, if you had invested $1,000 at the time of our advice, you would have $676,774 when Nvidia was added to this list on April 15, 2005!
It’s important to note that Stock Advisor’s overall average return is 825%, which is a market-crushing outperformance when compared to the S&P 500’s 164% return. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

Disclaimer and Risk Warning
Cryptomantr does not endorse or is responsible for any content, accuracy, quality, advertising, products, or other materials on this page. The image used in this article is for informational purposes only and is provided to us by a third party.  cryptomantr should not be held responsible for image copyright issues. Contact us if you have any issues or concerns. Readers should do their research before taking any actions related to the company.