TSMC stock plunges after investor conference; commentator sees buying opportunity amid volatility

Taiwan Semiconductor Manufacturing Company's stock price experienced a significant drop following its investor conference, with the broader Taiwanese stock market seeing its largest single-day decline in history. The TAIEX index plummeted by 2953.71 points on Friday, and TSMC's shares hit a low of NT$2290.

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Every time the market experiences intense fluctuations, it is often an opportunity to buy TSMC.

Financial commentator Hsieh Chin-ho, chairman of President Media Group, suggested that the market's reaction, interpreting the conference as a "good news is out" event, overlooks potential buying opportunities. He pointed to historical patterns over the past two decades, where significant market volatility often coincided with favorable entry points for TSMC.

Hsieh cited several past instances, including the 2008 financial crisis when TSMC hit a historic low of NT$36.4, the 2015 memory chip downturn, and the early days of the COVID-19 pandemic in 2020. He also recalled the 2022 downturn amid geopolitical tensions and rising interest rates, where TSMC fell to NT$370, facing criticism that it was "hollowing out Taiwan." He noted Warren Buffett's investment and subsequent sale of TSMC ADRs due to geopolitical concerns.

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TSMC's operations are very transparent, its P/E ratio can be calculated, and its future vision is also very clear. This pullback is also an opportunity!

More recently, Hsieh referenced April 2023, when a Trump-initiated tariff announcement led to a 9.7% drop in the TAIEX, with TSMC falling to NT$780. He recalled advising investors that TSMC below NT$800 was a good buy then. He also mentioned criticism from academics like NTU professor Chiu Hung-jen, who suggested management should be held accountable if TSMC fell below NT$500.

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The market treats TSMC's investor conference as 'good news is out,' but every time the market experiences intense fluctuations, it is often an opportunity to buy TSMC.

Regarding the recent conference, Hsieh pointed to TSMC's second-quarter gross margin of 67.7% and a third-quarter guidance between 65% and 67%. He noted CEO C.C. Wei's statement about preferring not to maximize margins at the expense of long-term relationships, framing it as a strategy for mutual benefit rather than short-term gain. Hsieh emphasized TSMC's transparent operations, predictable P/E ratio, and clear future vision, reiterating that the current stock decline presents another investment opportunity.

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This approach is about sharing benefits with the market, not about killing the goose that lays the golden eggs.