5 favorite shares of Frank Schwarz: ‘This giant continues to offer enormous potential’

Frank Schwarz is a portfolio manager at the German fund house MainFirst. He is a new participant in this section.

As a pioneer in graphics processors and AI chips, it dominates Nvidia

the industry as the undisputed market leader. The American company, originally known for its graphics processors (GPU) for games, has successfully expanded into AI applications. In addition to GPUs for AI, Nvidia has developed specialized AI hardware, such as the Drive platform for autonomous driving. Nvidia’s dominance is further strengthened by its partnerships with leading universities, research labs and companies.

In our view, despite strong revenue growth in 2023, the company still has enormous potential for the future. Both the scaling of data centers and AI models have only just begun and will continue to grow in the coming years.

The Dutch ASML

is a major player in the production of chip making machines. As the market leader in machines that use extreme ultraviolet light (EUV), ASML makes the production of smaller chips possible. This technology is indispensable for the Taiwanese chip giant TSMC. It enables the company to produce chips with higher performance and lower energy consumption, which is essential for advanced AI applications.

ASML also contributes to the scalability and cost-effectiveness of chip production. As demand for AI chips increases, efficient and cost-effective production is crucial.

Taiwan Semiconductor Manufacturing Company (TSMC) is a leader in the semiconductor industry and plays a key role in the design and production of AI (artificial intelligence) chips.

AI chips require very precise manufacturing processes to achieve the necessary power and energy efficiency. TSMC is the only company in the world that can provide those advanced manufacturing processes, making it an important partner for Nvidia in the production of its AI chips.

TSMC’s ability to produce smaller and more efficient chips is essential to the advancement of AI. Small structure widths allow more transistors to be placed on a chip, resulting in more computing power and improved energy efficiency. This is important for AI applications, because more complex models can then be trained.

Microsoft

has emerged as a leader in the AI ​​industry. The American company did this both by integrating AI into its own products and services – such as the use of AI in the search engine Bing for smarter search results – and through strategic investments and partnerships. It aims for new business opportunities with AI.

Central to Microsoft’s focus on AI is its cloud platform Azure. This offers a wide range of AI services that allow companies to develop, train and implement AI solutions. The services range from tools for AI-based analytics to services that provide developers with advanced algorithms for speech recognition, image processing and more.

Zscaler

is a leader in cloud security and benefits significantly from the integration of AI. At the same time, the company benefits from the continued expansion of cloud infrastructure by companies such as Microsoft and Amazon.

AI enables Zscaler to provide advanced threat detection and analysis. The US company uses AI to process large amounts of data in real time and quickly identify unusual patterns or activities, which is crucial for early detection and prevention of potential attacks.