Shares of Taiwan Semiconductor are gaining favor among hedge funds as the company is critical in the semiconductor sector, despite geopolitical risks tied to its location in Taiwan. TSMC's management has successfully diversified its operations internationally and continues to expand production capacity beyond Taiwan. The company is leveraging the growing demand for AI chips, with significant developments like the ramp of its 2nm process slated for the second half of the year. Overall, TSMC is seen as a timely investment opportunity for those capitalizing on AI growth.
Taiwan Semiconductor is an early favorite among hedge funds due to its critical role in the semiconductor industry and strong international diversification strategies.
Despite geopolitical risks associated with being based in Taiwan, TSMC has implemented effective measures to mitigate significant risks while expanding production capacity.
TSMC is well-positioned to benefit from the booming demand for AI chips, particularly with the upcoming ramp of its 2nm process in the second half.
With a current valuation of 28.3 times trailing P/E, TSMC stands out among the semiconductor leaders as a potentially undervalued investment.
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