$Taiwan Semiconductor Manufacturing(TSM)$
It feels like TSMC's stock price is unstoppable again, making another leap after hitting a new high.
Recently, TSMC's stock price has been quite in sync with my emotions toward it. When Trump took office, it fell, and I was also frustrated [covering my face]. Now, it has suddenly rebounded, as Kissinger, who led Intel's transformation, stepped down (his strategy was clearly focused on strengthening manufacturing, which aligns with the US policy of bringing chip manufacturing back to its homeland, rather than focusing on design). In a few days, TSMC will also announce its November revenue data.
During this period, Intel and Samsung have been falling further behind TSMC, with positive news about TSMC's progress. So, the threat from Trump's presidency isn't likely to have much impact; as long as the adjustment isn't too large, it will rebound. During the upward cycle, TSMC's monthly revenue has mostly exceeded expectations, and each time the monthly sales data comes out, I'm always worried that I won't be able to add more shares before it goes up (November may see a month-on-month decline, as October was too exaggerated).
Where will this surge end? I feel that if it reaches 240 in two to three months, it would be relatively sufficient, and I might need to reduce my position. This is based on my projection of TSMC's net profit of $53.1 billion in 2025, which I mentioned in a previous article. Personally, I believe the probability of exceeding $53.1 billion is over 50%. In fact, the most important thing is to maintain patience and ignore the volatility.
What about the risks? The risk from competitors is not only low but even lower. The risks from demand and cycles are also low, thanks to the GB200 ramp-up and strong demand for 2nm mass production by the end of 2025. The only risks TSMC faces are geopolitical and policy risks.
Even if Trump increases taxes during this period, to be honest, I'm no longer worried, because Intel and Samsung are really struggling. Tax hikes won't change who gets the orders in the short term. TSMC can easily shift those to US clients, so why increase taxes on them? All they need to do is promise to accelerate investments in building factories in the US, and exemptions are also possible. Another risk comes from Taiwan's own situation. The risk from Trump's presidency has increased, but in the medium to short term, it's still relatively low.
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