3 AI Stocks for the Next $1 Trillion Chip Boom

Foreign shipmakers just got hit with a ticking clock. A looming Washington decision could force them to choose between building factories on US soil or facing a tariff that doubles their costs overnight. And you don't want to be on the wrong side of that trade. So, this video is designed to help you prepare. Now, I found three stocks with serious upside potential that already locked in their safety net, including spoiler, Nvidia, and two stocks that you might not be as familiar with. You definitely want to know about the whole group before the market catches up. Hi, I'm Jacob Wade. I'm a financial coach that helps high-income earners retire early. And if you like timely financial news videos just like this one, hit the thumbs up button below. It just lets me know to keep making more videos just like this one. So, here's the details. Back in January, the administration imposed a 25% tariff on advanced logic chips under a national security investigation. Now, that was just phase one. Phase two is now on the horizon. And this is the real threat, the one that could push tariffs toward 100%. And here's the part that most coverage is missing. Commerce's own deadline to report back on the data center chip market has already come and gone. The report is actually believed to be in the president's hands right now, and the findings haven't been made public yet. That means a decision on whether to escalate this tariff could land at literally any time. There's no more calendar to watch. The decision window isn't opening soon, it's opening right now. So, the mechanism for avoiding this massive tariff is simple on paper. Companies file a committed US manufacturing plan with the Commerce Department, and it gets audited as construction proceeds. Now, Commerce Secretary Howard Lutnick has said this push alone could ultimately drive around $1 trillion in domestic chip manufacturing investment. Now, here's why this matters right now, because this isn't a story about something that's already happened and is priced into stocks. It's actually unfolding right now as I speak. The clearest sign of that is that Lutnick has been publicly pressuring Samsung and SK Hynix, two of the world's largest memory chip makers, to commit to building more US fab capacity. Now, that pressure campaign came right as SK Hynix was preparing its Nasdaq debut, which gave Washington real leverage at exactly the moment SK Hynix needed US capital markets on its side. Smart move, right? So, now you have two very different groups of companies right now. The ones that already filed their US build-out plans and locked in that protection, and the ones still being leaned on to make that commitment. That split is exactly what's about to start showing up in these stocks' cost structures and their own valuations. Now, here's the thing about a decision window with no fixed deadline left on it. Markets don't wait for the announcement, they move on just the rumor alone. Now, once word leaks on what that data center report actually concluded, the stocks that are already locked in in their exemption could hold steady, and the ones still exposed could reprice very fast in either direction. I went through the data to find which companies have already filed committed US build-out plans and are showing up strong in the actual numbers. So, I've got three stocks for you today, starting with a solid name that everybody knows, and building up to the strongest rated stock on the list, so stick around for that one. And by the way, finding these hidden news stories and keeping a pulse on what the market is doing is exactly what Steve Right Meister, our editor-in-chief at Wall Street Zen, walks through in his free Monday training sessions, 7:00 p.m. Eastern every Monday. If you want to join, you could sign up right here on the QR code on the screen, or just go to wallstreetzen.com/live, and you can sign up for free. All right, our first pick here is a stock that already spent its way out of this terror threat, and it did it in one of the biggest manufacturing commitments in the entire semiconductor industry. It's Texas Instruments, ticker symbol TXN. Now, Texas Instruments isn't just the calculator company that you might remember from the '90s. It designs and manufactures semiconductors that show up inside nearly everything electronic, from cars to industrial equipment to the phone that's in your pocket right now. And it's one of the loudest names in this whole tariff story because Texas Instruments has already committed $60 billion to expanding its US manufacturing footprint. And that's not just a pledge on paper. It's the exact kind of audited build-out plan that the Commerce Department uses to hand out exemptions. And the timing is very good on this because the business itself actually just turned a corner. Texas Instruments' trailing 12-month earnings came in at $6.1 billion, up 20% year-over-year, and the most recent quarter alone grew earnings 28.2% from the prior quarter. Revenue told the same story here, up 20% year-over-year on the trailing basis, with the most recent quarter growing 13.2% sequentially. So, after a rough multi-year stretch where earnings actually shrank, that's re-acceleration. And on top of that, Texas Instruments pays you a dividend yielding just over 2%, and it has grown that payout over the last 10 years without a meaningful cut. Now, on the analyst side, Texas Instruments has 24 analysts covering it, and the consensus lands on a buy recommendation with 10 of them at a strong buy. Now, right now, the top one-year price target comes from John Vin of Key Bank, who ranks in the top 2% of analysts in our database of more than 5,300 based on his historical stock-picking track record. Now, John's price target suggests the stock could see over 40% upside in the coming year. And the Zen Ratings also supports the bullish take. Now, Zen Ratings is our proprietary quant rating system that evaluates each stock on 115 fundamental factors to evaluate those with the highest likelihood to outperform the market. So, as of the week that I'm recording this, TXN earns an overall B's and rating, which amounts to a buy recommendation. Now, if you see a stock's specific strengths and weaknesses in the Zen ratings, you can also refer to the seven underlying component grades aligned with key fundamental areas. So, let's take a look at those. Now, for Texas Instruments, safety comes in the top 14%. Momentum and sentiment both land in the top 7%. Financials climbs into the top 6%, and the standout here is artificial intelligence, which is in the top 5% of every stock that we track. Now, that AI score isn't about the company's skin in the AI game, rather it's a proprietary AI algorithm that sifts through mountains of data to detect stocks throwing off subtle patterns that could lead to outperforming the market. So, the one real soft spot here is growth, which lands in the bottom quarter of all stocks, and that's a real consideration here. The company's longer-term growth has trailed the semiconductor industry average even as its most recent quarter has re-accelerated. But, the pattern here is compelling. A blue-chip company that is already locked in its tariff protection just turned a corner on growth and pays you a growing dividend while you wait for the rest of the story to play out. So, I'd say that's a solid way to open the list here. So, let's move on to the next name. And real quick, if you're getting value from this type of video, consider subscribing to the channel. We do this kind of real-time market research every single week, and I'd love to have you back for the next video. All right, let's get into the next stock. All right, the second pick here has made headlines when the tariff framework was first announced, and it's the most talked about AI company on the entire planet. Yes, you guessed it, it's Nvidia, ticker symbol NVDA. Now, Nvidia designs the graphics processors that power the vast majority of AI training and inference happening right now. And when the tariff threat first landed, Nvidia was one of the first names out of the gate with a commitment pledging $500 billion dollars toward producing AI infrastructure inside the United States. Now, one thing worth flagging here, that commitment is a bit different from a straight fab build. It's Nvidia locking in domestic production capacity for its systems rather than constructing its own chip factories. Still, it is the kind of concrete dollar-backed pledge that's kept Nvidia off the exposed list for tariffs. Now, the numbers behind Nvidia are staggering. Nvidia's trailing 12-month earnings hit 159.6 billion dollars, up 108.9% year over year. It's most recent quarter alone brought in 58.3 billion dollars in earnings, up 35.8% from the prior quarter. And revenue is just as strong here with 253.5 billion over the trailing 12 months, also up 108.9% year over year. And the most recent quarter growing revenue at 19.8%. So, this is a company that's still accelerating at a scale that most businesses will never even reach. Now, on the analyst side, Nvidia has 25 analysts covering it, and the consensus lands still at a strong buy with 18 of those analysts at strong buy and the rest at a buy. Not a single analyst on that entire list has a hold, sell, or strong sell recommendation. Now, their average price target implies an upside potential of over 55% from here, but some individual targets go even further. I've been Fineas Seth at Tigress Financial 8, top 5% ranked analyst based on stock picking prowess, has a price target suggesting the stock could see greater than 100% upside in the coming year alone. Now, let's look at our data on this. Now, Nvidia earns an overall Zen rating of a B, amounting to a buy recommendation, but it's really more like a B plus since the stock ranks in the top 6% of stocks tracked based on fundamentals, and the threshold for the A rating is in the top 5%, so it's pretty much there. Now, if we look at the component grades, they're very strong overall. Now, value is in the top 90% of stocks tracked. Sentiment follows close behind in the top 11% and then it steps up even again, the artificial intelligence component lands in the top 4% at an A grade. And the true standout component here is financials which tops out in the top 1% of every single stock that we track. For a company generating this much cash off the AI boom, that's exactly the grade that you want leading the pack here. Now, safety, which lands at a D, is our one real caution flag here. A stock moving this much capital this fast will always carry some safety risk and that's worth knowing before going in. But the overall picture here remains strong for Nvidia. It locked in its US manufacturing commitment, it is still growing earnings and revenue at triple-digit rates which is unbelievable concerning how big it already is and it carries Wall Street's strongest possible consensus rating behind it. That's a lot of firepower behind one single name. So, let's move on to our final pick and honestly, I think it's the strongest one on the list. Plus, it's backed by an actual government-to-government agreement rather than just a company promise here. And by the way, if you like stock talk like this, then I once again remind you just check out Wall Street Zen's no-cost live training sessions. You can join our editor-in-chief Steve Reitmeister on Mondays at 7:00 p.m. Eastern time. He doesn't just talk about what he's buying, but actually how he's finding the stocks so you can do the same in the days ahead. He also shares trade of the week combining the best of Zen ratings with his 40-plus years of investing experience. So, if you like this type of content, I strongly recommend just pause the video for a minute and register for free at wallstreetzen.com/live. And you'll find the link in the description or you can just scan the QR code right here. Again, just pause real quick, you can sign up and then you will see you Monday at 7:00 p.m. Eastern. All right, the final name on our list is Taiwan Semiconductor Manufacturing company, ticker symbol TSM. Now, don't get confused here. The ticker is TSM, but many people call the company TSMC, same company. This company manufactures the vast majority of the world's most advanced chips, the ones inside nearly every AI accelerator, smartphone, and high-performance computer on the entire planet. And it's tariff protection isn't a company pledge just sitting in a press release somewhere. It's built into the US-Taiwan trade deal itself, which commits at least 250 billion dollars in Taiwanese semiconductor investments on US soil backed by 250 billion dollars in Taiwanese government credit guarantees. So, as part of that agreement, TSMC can import up to two and a half times the capacity of the new US fabs that it's building tariff-free while the construction is underway. That's about as locked in as it gets, and the business backing the deal is firing on all cylinders. Taiwan Semiconductors' trailing 12-month earnings hit 60.3 billion dollars, up 52% year over year. Its most recent quarter brought in 17.9 billion, up 15.2% from the prior quarter. Revenue, again, tells the same story here, 129.7 billion over the trailing 12 months and up 52% year over year with the most recent quarter growing at 5.9%. This is the company every major chip customer depends on, and it's still growing at a pace that you only see from companies like Nvidia. Now, on the analyst side here, Taiwan Semiconductor has five analysts that are covering it, and the consensus lands on a strong buy with three of them voting specifically for a strong buy. Their average price target implies an upside potential of over 30% from here, and the top end goes even further. Simon Coles at Barclays has a price target that suggests the stock could see greater than 60% upside just in the coming year. Now, let's look at our data on this. So, as of the week that I'm recording this, the stock receives an A grade amounting to a strong buy recommendation, which agrees with what analysts are already saying here. And if you look at the component grade profile, it's among the stronger picks in our entire database. Value comes in at the top 13% of stocks tracked. Artificial intelligence ranks in the top 6%. Then, the A grades take over here. Sentiment lands in the top 4%. Financials climbs up into the top 3%. But, the true standout here is momentum, which sits in the top 1% of all stocks tracked. Now, the soft spot here is growth and safety, both rated a C, and that's worth naming, honestly. A company operating at TSMC's scale, concentrated heavily in Taiwan, even as it builds out its US capacity, it carries geopolitical risk that a pure numbers model just can't really fully capture. And that's the one real risk you have to have on your radar with this name. So, the bottom line on Taiwan Semiconductor, it already has its US protection written into a formal trade agreement. Its earnings and revenue are accelerating at scale, and Wall Street has it as a strong buy with real upside left on the table. And our data actually agrees across nearly every component that matters here. If you only remember one name from this list, this is the one. So, there you have it. Three already strong stocks that have a big looming catalyst ahead. What do you think about the tariffs? Do you think it's just another taco trade, or does this catalyst actually have real legs behind it? Are you tracking any of the stocks that I mentioned here, or do you have another one that you want to add to the list? Help out the community just by dropping a comment below and sharing your thoughts. And if you like learning about this under the radar news catalyst, I invite you to check out another video featuring a catalyst that's not getting much press, but could create big moves for select stocks. It's on your screen right here right now.