1) Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Short % of Float (as of September 30): 0.50%
Number of Hedge Fund Holders: 156
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is engaged in manufacturing, packaging, testing, and selling integrated circuits and other semiconductor devices.
Market experts opine that the company’s strong market position and growth potential are aided by increasing artificial intelligence (AI) chip demand. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) has been strengthening its position as a leading player in the semiconductor manufacturing industry. Its advanced manufacturing processes, primarily in leading-edge nodes, resulted in attracting high-profile customers in the mobile and high-performance computing sectors.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s strong emphasis on cutting-edge technology placed it well to capitalize on the growing AI trend. Wall Street analysts expect that AI is not only fueling demand in data centers but is also boosting demand in the broader smartphone segment. As a result, this dual-pronged AI-driven growth should act as the primary tailwind for Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) over the coming years.
While AI applications continue to drive demand throughout product categories, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s advanced manufacturing nodes, primarily N3 and N5, continue to see full utilization.
Analysts at Susquehanna reissued a “Positive” rating on the shares of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), issuing a $250.00 price target on 14th August. Diamond Hill Capital, an investment management company, released its second-quarter 2024 investor letter. Here is what the fund said:
“On an individual holdings’ basis, top contributors to return in Q2 included our long positions in Alphabet, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and Microsoft. Semiconductor manufacturer Taiwan Semiconductor’s (TSMC) fundamentals remain solid as demand for its chips continues growing — particularly as the machine learning and cloud computing trends gain more traction.”
While we acknowledge the potential of TSM as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than TSM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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