The “chip race” continues…
Companies continue to push to be the world’s largest chip producer.
The race in the technology sector never stops. And Taiwan Semiconductor Manufacturing Company (TSMC) is pushing its way to the top. TSMC is the world’s largest contract chip manufacturer, assembling semiconductors for Apple, Qualcomm, Nvidia, and over 400 other companies.
Recently, the company got some good news. TSMC’s rival, Intel, announced that its next-generation chips would be delayed – a setback that could give the Taiwanese chipmaker a big leg up in this competitive market.
The stock rose around 10% following this announcement, helping it reach a $413 billion market valuation. This uptick helped push the stock into the world’s ten most valuable companies’ category – knocking out Johnson & Johnson.
Where’s the money?
When it comes to a highly competitive and saturated industry, using other company’s shortcomings is the name of the game. And that’s precisely what we’re seeing TSMC doing. And this strong response is important, especially after TSMC having to cut Huawei as a client due to the recent U.S. embargo. And it’s important because it proves that investors still believe in this tech giant.
And truthfully, I do too – especially after hearing that Intel could be outsourcing a good amount of its production to TSMC
And here’s how you can set yourself up for success…
How can I get some?
What’s the famous saying? What is one man’s trash is another man’s treasure? Well, it seems when it comes to this TSMC situation, what we’re seeing is much of the same – one company’s shortcoming is another company’s opportunity for growth.
And this boost is reminding me of when AMZN began to capitalize on the shift to online shopping. And suddenly it was AMZN vs. brick and mortar. This battle is still relevant today as well as more people stay home, brick and mortar retail lose, and AMZN wins.
In the same scope, as Intel falls behind in production, delivering bad news to investors and customers, TSMC is looking to capitalize on this.
So, I’m sure it comes to no surprise when I say TSMC is a buy on any pullback that we see. But truthfully, Intel is on my watch list as well. Because I believe with this push from TSMC – Intel will adjust their plans and work out the kinks, making it a buy opportunity as well – one that many might miss.
In the Spotlight: The infamous golden arches
There’s no denying that McDonald’s is having a rough year. But regardless, its dismal quarterly earnings were still jarring.
Here’s the rundown for this fast-food giant…Total sales sank 30% in the second quarter compared to a year ago, McDonald’s announced Tuesday, falling to $3.77 billion. Net income plummeted 68% to $483.8 million.
But McDonald’s CEO is feeling optimistic for the future to come noting that he believes that quarter two would be the worst quarter of the year and that it can only improve with time. And some of his numbers backed up this positive outlook.
For example, US same-store sales were down 19.2% in April compared to last year. But that loss was cut down to down 5.1% in May, and it got even better in June, reporting a decrease of only 2.3%.
Now, if the CEO’s prediction happens to be correct, I believe this could be an excellent investment opportunity in the near future, as many have sold off the stock due to these disappointing numbers. So, I’ll be keeping a close eye on this stock, and I’ll be sure to keep you updated.
Did You Miss This?!
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