TSMC(US:TSM) The Motley Fool·2025-12-04 00:20Core Viewpoint - Some investors are optimistic about Intel's potential resurgence, but they may overlook Taiwan Semiconductor's (TSMC) established leadership in the semiconductor industry [1][2]. Group 1: TSMC's Market Position - TSMC is the leading manufacturer of artificial intelligence (AI) processors, producing an estimated 90% of the world's most advanced semiconductors [3]. - TSMC's competitive advantages are expected to persist for up to two decades due to continuous investments in next-generation semiconductor manufacturing [4]. Group 2: Financial Performance and Growth - TSMC's sales increased by 30% to $33.1 billion in the third quarter, with earnings rising 39% to $2.92 per American depositary receipt (ADR) [4]. - AI data center revenue for TSMC is projected to grow at a compound annual rate in the mid-40% range through 2029, with demand for AI being stronger than previously anticipated [5]. Group 3: Valuation Comparison - TSMC's stock is significantly cheaper than Intel's, with TSMC having a price-to-earnings (P/E) ratio of 30 compared to Intel's P/E ratio of 667 [6]. - The tech sector's average P/E ratio is approximately 44, indicating that TSMC offers a better valuation opportunity [6]. Group 4: Investment Recommendation - Given TSMC's larger opportunity in the AI market, unmatched manufacturing dominance, and more attractive share price, it is recommended to consider investing in TSMC over Intel [7].