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AI Market Divergence: Analyst Highlights CPO, Indium Phosphide, and Biotech as Key Opportunities
Electronic Technology · Semiconductors · economic_daily · 2026-08-27
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Market analyst Chu Cheng-chih notes a divergence in AI stocks, recommending focus on CPO, indium phosphide, and biotech, while tipping Chu-Hwa for market leadership.
What Happened
Market Dynamics: As the AI sector experiences a period of divergence, investors are shifting focus toward niche industries with tangible growth potential. While Nvidia's financial performance remains strong, market sentiment toward the broader AI supply chain has become more selective, driving capital into specialized sectors like optical communications and biotechnology.
Industry Highlights: In the optical communications space, demand for CPO components such as Fiber Array Units (FAU) is surging. Largan Precision has successfully entered Nvidia's supply chain through technological advancements, positioning itself as a key player. Meanwhile, the scarcity of indium phosphide substrates has brought upstream companies like OptiWorks into the spotlight as potential growth leaders.
Biotech Potential: The biotechnology sector is gaining momentum, bolstered by the integration of AI in drug development, as seen in the recent successes of companies like Moderna. In the Taiwan market, firms such as PharmaEssentia and Peil Biotech are attracting significant interest from foreign investors due to positive clinical trial progress and strong market positioning.
Leadership Race: Chu-Hwa, a leading manufacturer of server rails, is emerging as a top contender for the market's highest-priced stock title, challenging Aspeed. With significantly improved profit margins and robust demand from the AI server sector, analysts project substantial EPS growth, making it a stock to watch closely in the coming quarters.