Jim Cramer’s Hottest 10 Stock Picks

5. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)

Number of Hedge Fund Investors:135

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), the world’s leading semiconductor foundry, dominates the global market with over 50% share, making it a crucial supplier to major tech companies like Apple Inc. (NASDAQ:AAPL), NVIDIA Corporation (NASDAQ:NVDA), and Advanced Micro Devices, Inc. (NASDAQ:AMD). Its cutting-edge technology, including 5nm and 3nm chips, keeps Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) ahead of competitors and ensures consistent demand for its products.

To manage geopolitical risks and meet increasing global demand, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is expanding its manufacturing operations beyond Taiwan, with significant investments in the U.S. and Japan. This strategic move is reflected in Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s strong financial performance, with recent revenue reaching $20.82 billion and earnings per share at $1.48, both surpassing expectations.

When asked if Taiwan Semiconductor Manufacturing Company (NYSE:TSM) is a good long-term buy, Jim Cramer responded positively, saying it’s a solid investment despite ongoing concerns about Taiwan.

“I think you’re fine. I think that there’s always going to be a worry about Taiwan. I think that if you go back to what Lisa Su said, she didn’t tell you not to worry about it because nobody says that. She says, you know, this one is not going to be a problem, and I’m with her”. Cramer said.

Cooper Investors Global Equities Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q2 2024 investor letter:

“Unsurprisingly the portfolio’s best performers in the very short term reflect this pattern, having narrowed to those most obviously exposed to the AI story – Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and Alphabet. While the portfolio has owned semiconductor companies for years it remains diversified and is underweight the group from an active risk perspective, dragging on relative performance in the last six months. The portfolio is currently positioned to take advantage of the Value Latency we see in smaller sized companies, and the performance of the quarter has been more aligned with those factors.

While this positioning is painful in the short-term, we see considerable embedded value in our portfolio. We also see considerable risks and uncertainties existing in the AI theme that are not reflected in the Value Latency on offer in many stocks that have surged.

Returning to the AI story, today the portfolio has around 10% of capital invested across TSMC and Alphabet. We think TSMC has a tremendous opportunity to extract more value from the profit pool currently being enjoyed by its downstream customers.”