Shares of Taiwan Semiconductor Manufacturing Co. (TSMC) moved sharply higher Tuesday morning on reports that Berkshire Hathaway Inc. had bought more than US$4.1 billion of TSMC’s American depositary receipts (ADRs), dealers said.
As of noon, shares of TSMC had surged 7.87 percent to NT$480.00 (US$15.48) with 93.67 million changing hands, while the Taiex, the Taiwan Stock Exchange’s benchmark weighted index, had risen 2.48 percent to 14,526.79 on turnover of NT$224.28 billion.
In a filing with the United States’ Securities and Exchange Commission, Berkshire Hathaway, run by billionaire investor Warren Buffett, said it owned about 60.1 million TSMC ADRs on an investment of more than US$4.1 billion as of the end of September.
International news wires, which reported the filing, described the investment as a rare and significant move into the technology sector by Buffett’s conglomerate.
“Many investors here simply followed Buffett in picking up TSMC shares Tuesday because they are impressed by the American investment guru’s vision and strategies,” Mega International Investment Services Corp. analyst Alex Huang said.
“Investors see Buffett as someone who holds stocks for the long term, and the large buy of TSMC shares showed his faith in the chipmaker’s long-term outlook by ignoring short-term market uncertainty.”
The surge in TSMC’s share price helped the stock easily hurdle the nearest technical resistance ahead of the NT$450 mark, Huang said.
“My brokerage expects TSMC to report NT$38.8 in earnings per share in 2022. Judging from its share price, the stock appears attractive,” Huang said.
“While inventory adjustments in the global semiconductor industry could drag down its EPS slightly to NT$36.7 in 2023, the chipmaker remains profitable. After inventory adjustments that should end by the end of Q2 2023, it will return to a growth pattern,” he said.
After the rally, however, the stock has moved closer to the next technical hurdles ahead of NT$502.00, Huang said.
TSMC’s gains helped push the bellwether electronics sector 3.90 percent higher as of noon and the semiconductor sub-index 6.25 percent higher.
Among other semiconductor stocks, United Microelectronics Corp., a smaller contract chipmaker, had risen 4.01 percent to NT$46.70, and smartphone IC designer MediaTek Inc. had added 4.16 percent to NT$726.00.
Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. had gained 0.49 percent at NT$102.00, while PC brand Asustek Computer Inc. had added 1.41 percent to NT$251.50.
Source: Focus Taiwan News Channel