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Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) is one of the AI stocks on Wall Street's radar. On July 6, Citi reiterated that Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) is well-positioned to raise its 2026 revenue growth outlook and long-term growth targets.

The research firm has already reiterated a Buy rating on the stock and raised the price target to NT$3,800 from NT$2,875. The bullish stance and price target hike underscore confidence that the company will continue to benefit from rising demand for advanced artificial intelligence chips. Stronger visibility into AI-related demand affirms the optimistic earnings outlook.

Citi expects the company to continue capitalizing on strong demand for advanced AI chips, which remain strong across advanced process technologies and extend beyond AI graphics processors. It also expects the company to benefit from wafer pricing rising into next year as demand for TSMC's N2 and N3 process technologies strengthens. The research firm has also touted TSMC's competitive edge, stemming from its manufacturing scale and leadership in advanced packaging.

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) manufactures and sells advanced chips used in artificial intelligence applications.

While we acknowledge the potential of TSM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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