2023 has been the year of artificial intelligence. The release of ChatGPT last year set off a frantic race between Big Tech giants and start-ups alike to develop and release better iterations of AI technology. And Wall Street has been in the throes of ongoing excitement over the potential of AI; shares of Nvidia (NVDA) -), the semiconductor company that makes AI tech possible, skyrocketed this year on AI-fueled excitement.
The Big Tech sector, powered by investor excitement over AI, has been so strong this year that a cluster of the biggest names have been grouped together under the moniker: the Magnificent Seven.
Made up of Nvidia, Apple (AAPL) -), Tesla (TSLA) -), Microsoft (MSFT) -), Meta (META) -), Google (GOOGL) -) and Amazon (AMZN) -), each of the seven has strong exposure to and potential with AI.
Related: If Nvidia CEO Jensen Huang had a chance to do it all again, he wouldn't
Deepwater's Gene Munster, who has been quite bullish about the Magnificent Seven, said that if he were to add an eighth company to the bundle, it would be an easy choice: Taiwan Semiconductor Manufacturing (TSMC) (TSM) -).
If Nvidia sells the building blocks to the AI revolution, Munster told CNBC, TSMC sells the clay.
"They are at the very foundation of all these companies," Munster said.
TSMC, with a market cap of more than $500 billion, has surged throughout November, hitting a share price of $99 at last check Wednesday.
The company last week reported better-than-expected sales for October, noting a 15.7% year-over-year increase in revenue to roughly $7.5 billion, a 34.8% month-to-month increase. Between January and October, the company reported more than $56 billion in revenue, a 3.7% increase from the year-ago period.
"All these companies, Apple needs them; Nvidia is a big customer. The beautiful thing about TSMC is that they're just going to benefit," Munster said. "If you believe in AI, you have to own TSMC."
Munster noted that only about 6% of TSMC's current business is related to AI, which gives them plenty of room to grow quickly over the next five years.
The company said in October that it expects a gross profit margin of at least 51.5% for the current quarter.
The stock is up around 32% for the year; Microsoft shares are up 54%, Google is up 51% and Tesla is up 98%.
Related: Key investor on why Nvidia has tainted Big Tech stocks
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