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$3,000 Split Across Nvidia, Broadcom, and TSMC Could Be Worth This Much by 2030

Key PointsNvidia is the king of AI and set to see continued strong growth in the years ahead.

With $3,000 allocated, a diversified AI stock portfolio consisting of Nvidia, Broadcom, and Taiwan Semiconductor Manufacturing could potentially yield substantial returns by 2030. This investment strategy entails purchasing five shares of Nvidia, three shares of Broadcom, and two shares of TSMC, which totals to under $3,000. Should the AI infrastructure expansion persist, this portfolio could be valued at over $9,000 by the end of 2030, marking a more than threefold return within four years.

The primary risk, of course, is an AI slowdown, but currently, growth appears robust, and demand for AI chips far exceeds supply.

Nvidia, the leading player in AI with its graphics processing units (GPUs), appears well-positioned to maintain its dominance in the sector over the next few years. The company exhibits rapid growth and has already projected a 70% revenue increase in the upcoming fiscal year. Analysts forecast Nvidia's revenue to reach nearly $1.2 trillion in its fiscal year 2031 (ending January 2031), with adjusted earnings per share (EPS) reaching $28.79.

However, Nvidia has consistently outperformed analyst estimates in recent years, and this trend is expected to continue. Based on my projections, Nvidia could generate over $1.9 trillion in revenue in fiscal year 2031 and deliver adjusted earnings of approximately $41.50 per share. If this materializes, the stock could trade at a forward P/E multiple of 20, valuing the stock at $830, representing a nearly fourfold increase from current levels. Consequently, five shares would be worth $4,150 by 2030.

Hyperscalers are increasingly relying on custom AI chips to reduce costs, and Broadcom, the semiconductor company frequently enlisted to develop these chips, presents significant growth opportunities in the AI infrastructure space. Broadcom's roadmap for custom chip design projects suggests that its custom chip business will double in the next fiscal year and again the following year, reaching $230 billion.

Analysts anticipate the company to earn $52.15 per share in fiscal year 2031 (ending October). Applying a 20-times forward P/E multiple to the stock, it would trade at $1,043 in 2030, tripling its current price. Holding three shares would then be worth over $3,100.

Taiwan Semiconductor Manufacturing, the world's largest foundry and the virtual monopoly in manufacturing advanced logic chips for AI data centers, is poised for strong growth over the next five years and beyond. The company holds a monopoly on manufacturing the most advanced logic chips powering AI data centers. Should AI spending continue to soar, its stock will follow suit.

The farthest-out EPS consensus for the stock is $28.03 in 2028, but projecting another 25% EPS growth in 2029, 20% in 2030, and 15% in 2031 could bring the adjusted EPS target to roughly $48.35 in 2031. Applying a 20-times forward P/E multiple to the stock, it would be valued at $967 in 2030, more than double its current price. Consequently, two shares would be worth over $1,900.

Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.

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