Don’t miss out on the booming market for AI hardware. You can start by conducting your due diligence on Taiwan Semiconductor (NYSE:TSM) and then taking a small position in Taiwan Semi stock, if you don’t have one already.
Sure, you can worry about Taiwan Semiconductor shares being “overbought,” which is a term than worry warts like to use. I wonder if they’re just hoping for a stock-price pullback because they missed out on the rally. You don’t have to let the perma-bears distract you from your master plan, which should include investing in Taiwan Semiconductor before the next run-up.
Taiwan Semiconductor’s Inspiring Survival Story
Earlier this year, Taiwan Semiconductor survived Taiwan’s most intense earthquake of the past 25 years. Astoundingly, Taiwan Semiconductor Chief Financial Officer Wendell Huang reported, “There were no power shortages, no structural damage to our fabs and there is no damage to our critical tools.”
Taiwan Semiconductor also withstood macroeconomic challenges in Asia and elsewhere, as Taiwan Semiconductor supplies chips globally.
Furthermore, the company overcame a supply-demand imbalance. As you may recall, there was a chip-inventory glut as manufacturers flooded the market during the post-Covid-19 recovery.
Through all of that, Taiwan Semiconductor maintained an excellent earnings track record. Moreover, Taiwan Semiconductor continued to pay decent dividend distributions.
Plus, Taiwan Semi stock rallied and the company’s market capitalization grew. It’s been an incredible, real-life beat-the-odds story that today’s investors can’t afford to overlook.
Taiwan Semiconductor Will Continue to Grow on AI Demand
Make no mistake about it. As long as AI-chip demand persists, Taiwan Semiconductor will not only survive, but will thrive and maintain a leadership position in the industry.
According to data from Bloomberg, 97% of analysts recommend buying Taiwan Semi stock. Also, Bloomberg Intelligence expects Taiwan Semiconductor to “outpace peers in the coming chip-making cycle.”
Remember, Taiwan Semiconductor has a vast chip-making foundry. In contrast, some other companies design microchips but don’t actually produce them from start to finish like Taiwan Semiconductor does.
Counterpoint Research data (per CNBC) determined that Taiwan Semiconductor “accounted for 61% of global foundry revenue in the fourth quarter.” Samsung Foundry was far behind in second pace, with 14% of the global chip-foundry market.
As long as the world’s demand for AI chips persists, Taiwan Semiconductor can continue to provide supreme value to its shareholders.
On that topic, Cathay Financial Holding President Lee Chang-ken cited strong AI demand in justifying the valuations of Taiwanese chip firms, including Taiwan Semiconductor. “You don’t feel this is a real bubble, because they really create the value, they really create profit,” Lee assured.
Taiwan Semi Stock: New All-Time Highs Are Coming
Taiwan Semiconductor overcame multiple challenges, including a massive earthquake, macroeconomic headwinds and a supply-demand imbalance. Amazingly, Taiwan Semiconductor survived and remains a global chip-foundry leader.
So, don’t get caught up in the false narrative that Taiwan Semi stock went up “too far” or “too fast.” Investing in Taiwan Semiconductor is a smart move because you’ll get exposure to the global AI chip-foundry industry.
Therefore, today’s a great day to start a Taiwan Semiconductor share position in anticipation of fresh all-time highs.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) and positions in the securities mentioned in this article.
