TSMC, a heavyweight in the semiconductor industry, enjoys a near-monopoly on manufacturing cutting-edge chips, with strong growth prospects and a favorable risk-reward balance despite geopolitical concerns.
The valuation of TSMC at 17 times next year's earnings is intriguing, especially with profits expected to soar over 30%, indicating robust growth and market positioning.
Apple's anticipated smartphone supercycle is set to significantly heighten upgrade rates, compelling consumers to embrace new features driven by AI, which fuels TSMC's growth.
Geopolitical risks due to TSMC's location in Taiwan are real, yet the market seems to have priced these risks into the stock, making the current valuation appealing.
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