What's Happening?
Taiwan Semiconductor Manufacturing Company (TSMC) has seen a remarkable 1,257% stock gain over the past decade, with an average annual increase of nearly 30%. TSMC is the world's largest semiconductor
manufacturer, holding a 68% market share in global semiconductor manufacturing and around 90% in advanced processors. The company is known for producing chips with smaller transistors, which are in high demand for AI, smartphones, and data centers. Despite geopolitical concerns due to its location in Taiwan, TSMC is investing in U.S.-based manufacturing facilities to mitigate risks and avoid tariffs.
Why It's Important?
TSMC's dominance in semiconductor manufacturing positions it as a critical player in the tech industry, benefiting from the increasing demand for advanced chips. The company's strategic investments in U.S. facilities enhance its resilience against geopolitical tensions and trade barriers. TSMC's ability to produce cutting-edge chips supports the growth of AI and other high-tech sectors, making it an attractive investment opportunity despite its slightly above-average P/E ratio.
What's Next?
TSMC's continued investment in U.S. manufacturing facilities is expected to bolster its market position and reduce geopolitical risks. The company's focus on producing advanced chips will likely drive further growth, supporting the tech industry's evolution. Investors may consider TSMC a viable long-term investment, given its strong market position and growth potential.
