Top 10 Stocks to Buy According to Lone Pine Capital

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

Number of Hedge Fund Holders as of Q4: 186

Lone Pine Capital’s Equity Stake: $742.65 Million 

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a leading multinational semiconductor company based in Taiwan, specializing in contract manufacturing and design. The company generates revenue through the sale of semiconductor wafers, foundry services, and customized solutions, catering to a diverse range of clients. TSMC also operates internationally through subsidiaries such as WaferTech in the United States and TSMC China Company Limited, reinforcing its global presence and expanding its market reach.

Several analysts have recently weighed in on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM). Barclays increased its price target from $240.00 to $255.00, maintaining an “Overweight” rating in a report issued on January 17th. The stock currently holds a consensus rating of “Moderate Buy” with an average price target of $220.00.

TSM has a price-to-earnings (P/E) ratio of 27.66, a price/earnings-to-growth (PEG) ratio of 0.66, and a beta of 1.06, indicating moderate volatility. Financially stable, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) maintains a debt-to-equity ratio of 0.24, a quick ratio of 2.30, and a current ratio of 2.57. Over the past year, TSMC’s share price has fluctuated between a low of $125.78 and a high of $226.40, reflecting strong investor interest and growth potential.

The company’s dominant position in the semiconductor industry, combined with its global expansion through key subsidiaries, ensures a steady revenue stream and long-term growth potential. Additionally, strong analyst ratings, a solid financial foundation, and increasing price targets highlight its resilience and attractiveness as a top investment choice in the tech sector.

Baron Emerging Markets Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q4 2024 investor letter:

“Semiconductor giant Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) contributed in the fourth quarter due to a cyclical recovery in semiconductors and significant incremental demand for AI chips. We retain conviction that TSMC’s technological leadership, pricing power, and exposure to secular growth markets, including AI/high-performance computing, automotive, 5G, and internet of things, will allow the company to sustain strong double-digit earnings growth over the next several years.”