AQR Capital’s Top 5 Stock Picks

4. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)

Number of Hedge Fund Holders: 87

AQR Capital’s Stake Value: $492,567,000

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the largest semiconductor firm in the world. Securities filings for the third quarter of 2022 reveal that AQR Capital owns 10.6 million shares of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) worth $492.5 million, representing 1.13% of the total 13F portfolio. 

On November 17, Taiwan proposed tax relief for Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s research and development costs in an effort to maintain its leadership in the largely significant and competitive semiconductor industry. 

Goldman Sachs analyst Bruce Lu on October 13 downgraded Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) to Buy from Conviction Buy with a price target of $89, down from $126. The analyst observed that the company’s management has turned “more conservative”, as it has acknowledged an impact from demand weakness, particularly for its N7 nodes. 

According to Insider Monkey’s Q3 data, 87 hedge funds were bullish on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), up from 72 funds in the earlier quarter. Warren Buffett’s Berkshire Hathaway added TSMC to its Q3 portfolio, buying more than 60 million shares worth $4 billion. Berkshire is the leading position holder in the company. 

Baron Funds made the following comment about Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q3 2022 investor letter:

“Semiconductor giant Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) detracted from performance due to the global macroeconomic slowdown and softening demand for consumer electronics. We retain conviction that Taiwan Semi’s technological leadership, pricing power, and exposure to secular growth markets, including high-performance computing, automotive, and IoT, will allow the company to deliver strong revenue growth over the next several years.”