Top 10 Technology Stocks to Buy According to Hedge Funds

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

Number of Hedge Fund Holders: 187

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is one of the Top Technology Stocks to Buy According to Hedge Funds. In August 2025, the company highlighted key changes and activities, including the acquisition and disposition of fixed-income investments totalling NT$10.2 billion and NT$0.4 billion, respectively. Also, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) issued unsecured bonds to the tune of NT$12.3 billion, possessing varied maturity periods and interest rates.

In Q2 2025, the company reported consolidated revenue of NT$933.79 billion, net income of NT$398.27 billion, and diluted EPS of NT$15.36 (US$2.47 per ADR unit). On a YoY basis, its revenues rose 38.6%, while net income and diluted EPS both went up by 60.7%. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)’s business in Q2 2025 was supported by continued strong AI and HPC-related demand. In Q3 2025, it expects its business to be aided by healthy demand for its leading-edge process technologies.

Baron Funds, an investment management company, released its investor letter for Q2 2025. Here is what the fund said:

“Our largest add during the quarter was Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as we continued to build our position. We believe that while near-term uncertainty due to tariffs and macro remains heightened, TSMC’s competitive positioning in leading-edge semiconductor manufacturing remains unmatched. We also believe that TSMC will benefit from a long duration of growth as the adoption of AI proliferates across industries – and the recent developments in the space which we discussed above (e.g. removal of the AI Diffusion rule, accelerated adoption of reasoning-based AI inference, and the expansion of scaling laws) will serve to further accelerate the adoption of AI. We also like the fact that TSMC will benefit regardless of the ultimate market share split between GPUs and application-specific integrated circuits. It’s the ultimate “arms dealer” to AI.”