Taiwan Semiconductor vs. Intel: Which Semiconductor Stock is a Better Buy?

NYSE: TSM | Taiwan Semiconductor Manufacturing Co. Ltd. ADR News, Ratings, and Charts

TSM – As the global chip shortage rages on, the shares of automakers and electronic device makers suffer. However, chip stocks continue to see gains. Taiwan Semiconductor Manufacturer Co (TSM) and Intel (INTC) are two well known chip stocks, but which is the better buy? Read more to find out.

When it comes to semiconductors, most investors gravitate toward the industry’s top names, such as NVIDIA (NVDA). However, the industry has a wide range of other publicly traded chipmakers, some of which are deserving of your investing dollars. At the very least, these stocks are worthy of analysis.

Shift your attention away from NVDA and the sector’s recent top performers, and you will find some surprisingly attractive buying opportunities. The moral of this story is it is a mistake to assume all semiconductor stocks are overvalued simply because the industry has been on a hot streak for more than a year.

Taiwan Semiconductor Manufacturer Co (TSM) and Intel (INTC) are two semiconductor stocks every investor should analyze in-depth. I’ve done the work for you. Here is a quick look at each of these stocks.

Taiwan Semiconductor Manufacturer Co (TSM)

TSM is the global leader in dedicated circuit foundry. TSM makes integrated circuits for clients in accordance with proprietary IC designs. This feat is accomplished through TSM’s advanced production processes.

TSM is a POWR Ratings disappointment with an overall grade of C, which translates into a Neutral rating in the POWR Rating system. The stock has D grades in the Value and Growth components. Click here to learn how TSM grades in the remaining components, including Momentum, Stability, Sentiment, and Quality.

Out of the 99 publicly traded companies in the B-rated Semiconductor & Wireless Chip industry, TSM is ranked just outside of the top half, slotting in at 54th overall. You can find the top stocks in this industry by clicking here.

TSM is trading within $17 of its 52-week high, yet it appears overvalued with a forward P/E ratio of 30.84. Analysts have a bearish outlook for TSM, setting an average target price of $85.78. If TSM drops to this price, it will have declined by nearly 29% in value. 

Click here to check out our Semiconductor Industry Report for 2021

Intel (INTC)

INTC sells more chipsets and microprocessors than any other semiconductor. However, INTC has struggled of late as competitors have captured some of the company’s market share.

INTC is a Strong Buy as it has an overall grade of A in the POWR Ratings system. The stock also excels in nearly every component, grading out with an A in the Value component and Bs in the Momentum and Quality components. You can find out how INTC grades in the remainder of the components such as Sentiment, Stability, and Growth by clicking here.

Out of the 99 stocks in the Semiconductor & Wireless Chip space, INTC is ranked 10th. If analysts are correct, INTC will move to the average target price of $62.59. Such a jump equates to a nearly 17% gain.

Investors on the prowl for a chipmaker with solid value and minimal downside in the event of a bear market have found it in INTC. INTC has a forward P/E ratio of 11.17, which is surprisingly low for a semiconductor stock. INTC’s low beta of 0.60 is also a bit surprising.

Which Semiconductor Stock is the Better Buy?

INTC is the better play. Aside from INTC’s superior POWR Ratings, the stock has a higher industry ranking than TSM. INTC is ranked 44 spots ahead of TSM in the Semiconductor space. 

Want More Great Investing Ideas?

3 Stocks to DOUBLE This Year


TSM shares were trading at $121.71 per share on Wednesday morning, down $2.99 (-2.40%). Year-to-date, TSM has gained 12.29%, versus a 21.44% rise in the benchmark S&P 500 index during the same period.


About the Author: Patrick Ryan


Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
TSMGet RatingGet RatingGet Rating
INTCGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


Does Trump Change Stock Market Outlook?

The rally of the S&P 500 (SPY) after the election gives a sense that investors are happy that Trump was elected. But perhaps there is more to this story than meets the eye. That’s why Steve Reitmeister shares his updated market outlook taking into account the pros and cons of Trumps proposed new policies. This comes with a preview of his top 11 stocks to buy now.

3 Streaming Stocks Benefiting from Cord-Cutting Trends

As streaming continues to dominate the digital entertainment landscape, the global streaming market presents a lucrative investment opportunity. So, it could be ideal to invest in fundamentally solid streaming stocks Netflix (NFLX), Walt Disney (DIS), and Roku (ROKU). Read further...

3 Gold Stocks to Buy as Safe-Haven Demand Grows

Gold is a stable investment now due to its role as a safe-haven asset during economic uncertainty, rising demand, industrial use, and growth, bolstered by central bank purchases and interest rate cuts. Therefore, investors should consider investing in top gold stocks such as Newmont (NEM), Barrick Gold (GOLD), and Agnico Eagle Mines (AEM). Read more...

3 AI Stocks Transforming Industries and Driving Future Growth

With rapid digitalization, rapid adoption, and development, as well as surging demand, the AI market is on the rise. Amid this backdrop, investors could buy fundamentally solid AI stocks NVIDIA Corporation (NVDA), Microsoft (MSFT), and Meta Platforms (META) poised for substantial gains. Continue reading...

Updated Stock Market Expectations

The S&P 500 (SPY) has already reached an impressive goal of hitting 6,000. Yet you can see how much shares are struggling now up against this resistance. Steve Reitmeister shares his views on what comes next for the market and his top 10 stocks to stay on the right side of the action.

Read More Stories

More Taiwan Semiconductor Manufacturing Co. Ltd. ADR (TSM) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All TSM News