Tower Semiconductor (TSEM) shares rose sharply on Friday after Mizuho initiated coverage with an Outperform rating and a $300 price target. Mizuho cited Tower’s leading position in silicon photonics, which supports high-speed optical connections in AI data centers.
Mizuho analyst Vijay Rakesh pointed to rising demand for data bandwidth as AI data centers expand. The firm projects the silicon photonics market will reach $1.3 billion in 2025 and grow to $8.5 billion by 2029.
Mizuho forecasts Tower’s revenue in the segment will grow at a 76% compound annual rate. The initiation adds to recent positive sentiment from other investment firms and highlights Tower’s role in the AI infrastructure supply chain.