We recently published a list of 15 Best Blue Chip Stocks to Buy According to Billionaires. In this article, we are going to take a look at where Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stands against other best blue chip stocks to buy according to billionaires.
Is A Potential Trade War on the Horizon?
The US stock market is showing volatility after President Donald Trump’s recent announcement of sweeping 10% tariffs on all US trading partners and higher tariffs on countries with a trade deficit with the US.
Economists and investors believe President Trump’s tariff policies could potentially lead to a trade war with America’s trading partners, propelling inflation even higher. These two factors could plunge the US into an economic slowdown, and the markets could potentially sell off quickly if a recession materializes among its looming threats.
On April 10, CNBC reported that stock prices rose sharply a day before after declining for four days straight following President Trump’s announcement of a pause in a significant part of his tariff plan. The White House said that Democratic lawmakers were indulged in partisan games by inquiring if any stock market purchases conducted in recent days were undertaken with prior knowledge of the fact that President Trump would authorize a pause in his tariff plans. Trump announced higher tariffs on China even after he announced a 90-day pause for steeper-than-baseline rates for several other countries.
READ ALSO: 10 Best Medical Stocks to Buy According to Billionaires and 10 Best Organic Food Stocks to Buy According to Billionaires.
Record High Tariffs in the US
On April 11, Erica York, economist and the vice president of federal tax policy at the Tax Foundation’s Center for Federal Tax Policy, talked to CNBC’s “The Exchange” about the ongoing scenario and said that the imposition of around 145% total tariff on Chinese goods would result in a suspension of most trade between the US and China. She said:
“It depends on how narrowly the tariff is applied or how broadly it’s applied, but generally, if you get north of a triple-digit tariff, you are cutting off most trade.”
She further opined that:
“There may still be some things without any substitutes that companies just have to foot the bill, but for the most part, that cuts it off.”
The economist said that Trump’s new China tariffs, along with the others he implemented, would raise the average tariff rate to record highs the country hasn’t seen since the 1940s. The current market volatility has created numerous remarkable investment opportunities, so let’s look at the 15 best blue chip stocks to buy according to billionaires.
Our Methodology
We reviewed financial media reports and ETFs to compile an initial list of blue chip stocks and selected stocks that have a 5-year revenue growth rate of at least 10%. We have also considered the popularity of these stocks among billionaire investors. These billionaires are founders or managers of some of the world’s leading hedge funds and companies. We also added the number of hedge fund holders for each stock as of fiscal Q4 2024, and sourced the hedge fund sentiment data from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A close-up of a complex network of integrated circuits used in logic semiconductors.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Billionaire Investors: 30
Number of Hedge Fund Holders: 186
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the largest contract semiconductor manufacturer in the world. Some of its prominent customers include semiconductor companies that outsource all or a part of their chip production, including Advanced Micro Devices, Nvidia, Broadcom, and more.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) reported notable growth in its net revenue in March 2025, reaching around NT$285.96 billion. This reflects a 10% rise compared to February 2025 and a 46.5% growth compared to March 2024. Its revenue for fiscal Q1 2025 also underwent a 41.6% surge compared to fiscal Q1 2024, reaching NT$839.25 billion. These trends reflect solid market demand for Taiwan Semiconductor Manufacturing Company Limited’s (NYSE:TSM) semiconductor products and robust growth.
Demand for the company’s services is one of the primary reasons investors are bullish on the stock. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) has plans to grow its capital expenditures (capex) to between $38 billion and $42 billion in 2025, which translates to an annual growth of 28% to 41%.
The company also pays a dividend, unlike most companies in the semiconductor industry. Wedgewood Partners stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q4 2024 investor letter:
“Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was another top contributor to performance during the quarter and for the year. The Company’s earnings growth dramatically accelerated compared to last year as the Company’s wafer fabrication and packaging volumes soared in 2024. In addition, the Company customer prices rebounded in the face of more normalized capital expenditures. The Company maintains a near-monopoly in the fabrication of nearly every new AI accelerator brought to market over the past two years. They continue investing tens of billions to build and 7ill future capacity with orders for what seems to be insatiable hyperscale demand for accelerated computing. The stock ended the year trading at a consensus forward earnings multiple that is several points lower than large-cap growth benchmarks, despite the Company’s dominant position in the most important industry that is driving one of the largest technological shifts in a generation.”
Overall, TSM ranks 5th on our list of the best blue chip stocks to buy according to billionaires. While we acknowledge the potential for TSM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TSM but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.