- Berkshire Hathaway of Warren Buffet buys TSMC stock worth $4.1 billion.
- Cowen analyst responds to CNBC news.
- Taiwan Semiconductor Manufacturing remained 40% down from the YTD peak.
Taiwan Semiconductor Manufacturing saw its stock (NYSE: TSM) gain over 10% early yesterday. That uptick followed a regulatory filing that confirmed that billionaire Warren Buffet acquired a substantial stake in the world’s leading chipmaker.
Buffet Buys TSMC Worth $4.1B
Reports revealed Buffett’s Berkshire Hathaway purchased nearly 60 million American Depository Receipts (ADRs) of the Taiwanese firm in 2022 Q3 for $4.1B. Market players recognize the Oracle of Omaha for investing in quality stocks trading at massive discounts and dividend-paying ones.
That could explain why he included TSMC shares in his investment portfolio. The stock traded approximately 45% down from its YTD peak in July – September. Moreover, it paid about a 2.50% dividend yield.
Meanwhile, Buffett’s approval stamp shows the billionaire calling for a bottom in the semiconductor stock. The chipmaker announced market-beating earnings for Q3 last month.
Cowen’s Analyst Reacts to the Updates
Taiwan Semiconductor Manufacturing stands at the supply chain’s heart, noting renowned names such as Qualcomm and Nvidia as clients. Also, it’s an exclusive supplier of the silicon chips used in the latest Apple devices.
Krish Sankar of Cowen responded to CNBC’s news, stating that TSMC ensured top-notch execution and remained among the top manufacturers in the game for sub-5 nanometre technology. Nevertheless, the analysts added that he would wait for a lucrative entry-level to buy the TSMC shares.
Buffett’s TSM purchase remained significant as it represents his first semiconductor investment. That’s according to Mizuho Securities’ tech managing director Jordan Klein. Kelin added that TSM remained of high quality since it gets & defines longer-term buy & hold.
Taiwan Semiconductor Manufacturing is the globe’s leading chip foundry. Meanwhile, the stock ranks #13 out of 32 in the IBD manufacturing group (IBD Stock Checkup data).
Also, Berkshire revealed new stakes, including $297M in Louisiana-Pacific Corp – a building materials firm – and $13M in Jefferies Financial Inc. Moreover, it exited investments in Store Capital Corp – a real estate firm that went private in September.