Ruane, Cunniff LP, an investment adviser managing Sequoia Strategy, released its Q4 2025 investor letter. A copy of the letter can be downloaded here. Sequoia Strategy returned 9% in Q4 compared to 2.7% for the S&P 500 Index. The Strategy delivered a return of 21.9% in 2025 versus 17.9% for the Index. In a year characterized by both strength and volatility, the Strategy outperformed the Index. The firm strives to invest in high-quality, fundamentally and financially strong businesses at reasonable prices. The Strategy is concentrated while it covers a wide range of sectors, business styles, and regions. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Sequoia Strategy highlighted Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as a notable contributor. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the world’s leading manufacturer of integrated circuits and other semiconductor devices. On March 27, 2026, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) closed at $326.74 per share. One-month return of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was -11.48%, and its shares gained 96.83% over the past 52 weeks. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) has a market capitalization of $1.695 trillion.
Sequoia Strategy stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its fourth quarter 2025 investor letter:
“ADR shares of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) returned 56% in 2025. As stock market participants, we are no strangers to outsized movements in share prices. As business analysts, however, it is not often we see a company of TSMC’s size and maturity grow revenues by 36% and profits by 51%. Put another way, TSMC’s trailing earnings-per-share multiple only expanded by 2% in 2025, with the rest of the share price gains driven purely by underlying business growth.
The growth driver was – surprise, surprise – AI. The red-hot datacenter buildout and the resulting surge in demand for AI chips saw TSMC’s AI chip sales nearly double last year. Whether the hundreds of billions of dollars in datacenter spend can sustain is anyone’s guess. For our part, we are not accustomed to projecting venture-capital like levels of growth with numbers that end in “trillion.” We are in uncharted territory…” (Click here to read the full text)
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) ranks 6th on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 224 hedge fund portfolios held Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) at the end of the fourth quarter, up from 194 in the previous quarter. While we acknowledge the risk and potential of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) and shared Columbia Global Technology Growth Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
