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My trading record (2021-08-20, bought US stock TSM)

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Explain the reasons of buying US stock Taiwan Semiconductor Manufacturing Company Limited (TSM) and share my views.

Abstract: Explain the reasons of buying US stock Taiwan Semiconductor Manufacturing Company Limited (TSM) and share my views.

Transaction detail

What I want to share with you today is the transaction I made on August 20. The details are as follows:

Bought stock

台灣積體電路製造公司(TSM)股票52週的日線圖
Taiwan Semiconductor Manufacturing Company Limited (TSM) 52-week stock chart
Image source: https://seekingalpha.com/symbol/TSM/chart

Reasons to buy TSM

Today, I saw that TSMC’s stock price had reached a recent low, so I decided to increase the position slightly. I am full of confidence in TSMC’s long-term company development.

Although the current price of TTM PE is about 29 times, it is not cheap, but with TSMC’s own industry leading position, it will definitely enjoy a certain premium. In addition, the semiconductor industry is becoming a hot object of global competition, and TSMC’s chip manufacturing business has been in short supply for a long time. Large companies in various countries such as Apple, Nvidia, AMD and other companies are striving to compete for TSMC’s relevant production capacity. It can be said that TSMC is currently in excellent operating conditions, as soon as the production capacity is increased, there will be demand to fill up immediately. TSMC has recently announced that it will increase prices for some products, so there is an opportunity to further increase its gross profit margin.

In terms of production capacity enhancement, many countries are now inviting TSMC to build factories. Although capital expenditure will increase in the short term, it will help increase production capacity and further consolidate TSMC’s international monopoly position in the long run. For such a large-scale enterprise that is uniquely in a hot industry with a monopoly position, and has a deep moat, I believe that if one can continue to absorb the stockholdings in TSMC at a low price level, it will effectively increase your capital appreciation in the long run.

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If you have any questions, please feel free to leave a message or comment below, I will reply you. Or if you find anything incorrect in the article, please let me know and learn from you. If you find it interesting or it may help you in any sense, please share with other people.

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