Wedgewood Partners, an investment management company, released its fourth quarter 2023 investor letter. A copy of the same can be downloaded here. In the fourth quarter, Wedgewood Composite’s net return was 11.4% compared to the Standard & Poor’s 11.7%, Russell 1000 Growth Index’s 14.2%, and Russell 1000 Value Index’s 9.5% return for the same period. Year-to-date, the fund returned 29.2% compared to 26.3%, 42.7%, and 11.5%, respectively for the indexes. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Wedgewood Partners featured stocks such as Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q4 2023 investor letter. Headquartered in Hsinchu City, Taiwan, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) manufactures, packages, tests, and sells integrated circuits and other semiconductor devices. On January 12, 2024, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stock closed at $101.24 per share. One-month return of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was -1.27%, and its shares gained 16.64% of their value over the last 52 weeks. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) has a market capitalization of $525.072 billion.
Wedgewood Partners stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its fourth quarter 2023 investor letter:
“Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was also a top contributor to performance. The Company began shipping chips that were fabricated using its industry-leading “N3″ node. Nearly all of the Company’s N3 capacity has been filled by high-end chip designers such as Apple, NVIDIA and even Intel. As high-performance computing, particularly related to AI in both data centers and edge devices, continues to build momentum, the Company will be a key supplier for many years to come. Despite the boom-and-bust cycle in demand seen for many semiconductors during Covid-19 and post-Covid-19, the Company should be able to post solid double-digit growth next year as inventories and end-market demand across most of its technology nodes get back to normal levels. The Company also maintains dominant market share in leading-edge nodes, which is in short supply, given the difficulties its competitors have had in scaling up EUV-based manufacturing. The Company has been able to secure higher prices because of this and can still generate excellent returns on elevated capital expenditures necessary for this scarce capacity. The Company is arguably one of a handful of the world’s most important and largest companies, but because the Company’s shares trade as an ADR (American Depositary Receipt) the shares are not part of the major stock market indices in the U.S. As a result, the shares are woefully under owned by U.S. investors (institutional and individual), particularly for a company that regularly generates cash flow return on invested capital in excess of +40%. Therefore, our growing position in these shares represent a significantly relatively overweight portfolio position versus our peers and benchmarks. We could not be more pleased by this anachronistic institutional imperative.”
High angle view of a semiconductor chip against an array of electronics components.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is in 19th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 107 hedge fund portfolios held Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) at the end of third quarter which was 121 in the previous quarter.
We discussed Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in another article and shared Bonsai Partners’ views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
