What are the NVIDIA concept stocks? Investment prospects analysis and stock selection tips

The Rise and Market Performance of NVIDIA Concept Stocks

Since 2024, NVIDIA( NVDA)'s stock price fluctuations have triggered a chain reaction across the entire tech stock market. In the first half of the year, the company’s market capitalization reached a peak of $3.34 trillion on June 18, briefly becoming the world’s most valuable company, surpassing Apple and Microsoft. However, the good times didn’t last long, as the stock experienced a rollercoaster correction, falling over 20% by the end of June, marking the worst monthly performance since September 2022, with a market value evaporating nearly $800 billion.

Entering the third quarter, market sentiment gradually recovered. By mid-October, NVIDIA’s stock price had rebounded to around $134.80, close to the June high of $135.58. This wave of rebound not only boosted NVIDIA itself but also drove related companies in the supply chain. According to the latest data, the performance of NVIDIA concept stocks such as TSMC, ASE, and KY Electronic also improved, indicating a ripple effect across the entire ecosystem.

What Are NVIDIA Concept Stocks?

NVIDIA concept stocks refer to listed companies that are closely related to NVIDIA’s business. Since NVIDIA adopts a fabless model, focusing on GPU chip design and R&D, actual manufacturing, packaging, testing, and assembly are outsourced to third-party manufacturers. Taiwan’s semiconductor industry holds an important position globally, with many companies directly or indirectly serving as NVIDIA’s suppliers or partners.

The investment logic behind NVIDIA concept stocks is that, with the rapid development of AI, cloud computing, autonomous driving, and other technologies, the demand for high-performance chips continues to rise. The growth in NVIDIA GPU sales will inevitably drive the performance of the entire supply chain. From hardware manufacturers to packaging and testing firms, and to substrate and server assembly companies, these enterprises will benefit from the prosperity of the AI industry.

Overview of NVIDIA Concept Stocks

The NVIDIA concept stocks in the market are mainly divided into two categories: Taiwan stocks and US stocks. Below are the profiles of representative companies:

Taiwan NVIDIA Concept Stocks Performance

NVIDIA-Related Companies in US Stocks

In-Depth Analysis of Key NVIDIA Concept Stocks

TSMC: The Key Infrastructure Pillar

As the world’s largest chip foundry, TSMC plays a core role in NVIDIA’s supply chain. In September, revenue increased by 39% year-over-year, reaching a record high of NT$251.8 billion. High-performance computing accounted for 52% of revenue, surpassing smartphones to become the company’s largest business segment.

Technologically, TSMC is set to start mass production of 2nm process at its Kaohsiung plant in 2025, further consolidating its leadership in advanced process technology. Currently, the market values TSMC’s 2024 P/E ratio at about 28 times, which is expected to decrease to around 22 times in 2025. Considering the company’s continuous quarterly earnings surpassing market expectations for over 20 quarters, this valuation level is quite attractive.

In the short term, the market is focused on the upcoming mid-October earnings briefing, where the company is expected to provide guidance for Q4. Technically, the stock is in a bullish pattern, with the 20-day moving average crossing above the 60-day moving average, indicating solid short-term support.

Quanta: Major Manufacturer of AI Servers

Quanta has the broadest cooperation scope with NVIDIA, covering HGX and PCIe server motherboards, racks, and even complete server assembly. The latest September report shows that AI server business has become the main driver of the company’s revenue, with non-PC products accounting for over 70%, while traditional PC business continues to decline.

This business structure shift reflects the company’s strategic adjustment. As NVIDIA’s next-generation products (such as B200A, GB200) enter mass production, Quanta’s orders are expected to further increase. The company’s financial reports show ongoing capital expenditure growth, further confirming confidence in long-term growth.

GIGABYTE: Rapid Expander in the Server Market

GIGABYTE’s subsidiary, GIGABYTE Technology, is a certified supplier for NVIDIA, providing rack and server products. The growth rate of its server business is remarkable: in 2023, servers accounted for only 21%, but in Q1 2024, it surpassed 50%, and in Q2, exceeded 60%.

Currently, NVIDIA’s H100/H200 products are selling strongly, and the next-generation product line has entered commercialization. This presents continuous growth opportunities for GIGABYTE.

ASE: Packaging and Testing Leader’s Opportunities and Challenges

As the world’s largest semiconductor packaging and testing company, ASE’s revenue declined 13% in 2023 due to softness in communications and mobile markets, but the company is actively expanding. In September, revenue reached NT$55.58 billion, a nearly 11-month high. The company is investing in new facilities in Kaohsiung and acquiring ASE’s packaging and testing facilities in the Philippines and South Korea, further strengthening advanced packaging capabilities.

However, ASE currently faces the challenge of lagging stock performance. Technically, multiple moving averages are in a chaotic crossover, reflecting market uncertainty about the future outlook.

ARM: Potential Winner in the AI Era

NVIDIA had planned to acquire ARM for $40 billion, but the deal ultimately failed. Nonetheless, cooperation between the two continues to deepen. NVIDIA currently holds about $147 million worth of ARM shares, accounting for over 6% of its investment portfolio.

Market rumors suggest NVIDIA is preparing to launch chips integrating ARM cores with Blackwell GPU architecture, entering the Windows on ARM field. If true, this could significantly boost ARM’s performance. Additionally, ARM has shifted its sales strategy from charging based on chip value to charging based on device value, indicating a move toward a more stable revenue model.

Investment Strategies and Outlook

For investors, selecting NVIDIA concept stocks should consider the following dimensions:

Performance Growth Certainty: Companies like TSMC, Quanta, and GIGABYTE have clear NVIDIA-related business proportions or relevance, with strong fundamental support for earnings growth.

Reasonableness of Valuation: Although many concept stocks have already experienced substantial gains, considering the long-term prosperity of the AI industry, some companies’ valuations remain competitive.

Technological Leadership: KY Electronic holds over 50% of FPGA chip testing capacity, supporting testing for GPU, FPGA, and high-speed Ethernet, key components for AI computing, with a relatively strong technological moat.

Supply Chain Irreplaceability: Different vendors occupy different positions in NVIDIA’s supply chain, but as NVIDIA’s business expands, new entrants may bring competitive pressure.

In the short term, investors should closely monitor quarterly reports, earnings guidance, and technical support levels. Long-term investors can adopt a more relaxed attitude toward short-term fluctuations, as the AI industry is still in its early stages, and demand for related products is far from saturated.

Overall Judgment

The development of the AI industry is accelerating, and NVIDIA, as a core participant,’s growth trajectory directly impacts the performance of the entire supply chain. Most NVIDIA concept stocks in Taiwan have solid earnings growth foundations and are not purely speculative concepts.

However, investors should avoid blindly chasing high. Some stocks have already experienced significant gains, and future growth must continue to justify high valuations. Additionally, keep a dynamic watch on supply chain changes and promptly grasp the competitive landscape brought by new entrants.

From a long-term perspective, as long as demand for NVIDIA GPUs remains high, related manufacturers are expected to maintain stable earnings growth. Investors should continue to follow industry developments and select core competitive and fundamentally supported targets for strategic deployment.