Billionaires like David Tepper, Stanley Druckenmiller, and George Soros are quietly increasing stakes in Taiwan Semiconductor Manufacturing (TSM), not Nvidia, as TSM plays a crucial role in manufacturing chips for Nvidia GPUs, Apple iPhones, and AI servers. TSM’s stock surged 40% in the past year despite its valuation remaining near sector averages.

TSM, the world’s top contract chipmaker, with a market cap of $1.21 trillion, pays an annual dividend of $2.13 per share and has seen a 20.43% increase year-to-date. In Q2, TSM reported record revenue of NT$933.79 billion and net income of NT$398.27 billion, showing strong growth and profitability metrics.

TSM is investing over $100 billion in the U.S. to build new chip fabrication plants, packaging centers, and R&D hubs. The company is also expanding in Japan with new manufacturing facilities for automotive chips. Congressman Cleo Fields recently purchased up to $500,000 worth of TSM stock.

Analysts are bullish on TSM, with earnings estimates for Q3 at $2.56 per share and a full-year estimate of $9.83 per share, showing significant growth. TSM’s management projects third-quarter revenue between $31.8 billion and $33.0 billion, with high gross profit margins despite increased investment costs.

Nine out of 12 analysts covering TSM rate it a “Strong Buy” with a mean price target of $261.38, implying a 10.7% upside. With strong earnings, guidance, and demand for its chips, TSM is poised for further growth, attracting attention from billionaires and analysts alike.

Read more at Yahoo Finance: Billionaires Are Buying Up This Chip Stock (Hint: It’s Not Nvidia)