ASML’s outlook sparked an overreaction from investors. It’s creating another buying opportunity for AI stocks.

The stocks of AI chipmakers such as Nvidia and TSMC and other AI hardware suppliers have been on a tear as Wall Street stays bullish on artificial intelligence — in the short term, at least.

The newest artificial intelligence (AI) chip stock in the $1 trillion club is Taiwan Semiconductor Manufacturing Company (NYSE: TSM). Here's why $1 trillion may be just a milestone in the stock's continued ascension into the ranks of the mega-caps.

Right now, Taiwan Semiconductor trades at a price-to-earnings (P/E) multiple of 32.2. As seen in the chart below, the company's valuation has surged dramatically over the last 12 months and its P/E is hovering near 52-week highs. There's a lot to choose from, but these are both great companies.

Chip investors should be discerning about which stocks to buy ahead of earnings season—not all semiconductor companies are performing well, according to Susquehanna. On Monday, analyst Christopher Rolland reiterated his positive ratings for Nvidia,