Do you think it’s too late to buy Taiwan Semiconductor Manufacturing Company stock? Here’s one reason why there’s still time.

The prices of many technology stocks have risen significantly over the past few years, Taiwan Semiconductor Manufacturing Company (TSM 1.86%)The company also known as TSMC is no exception. Over the past three years (ending March 16), TSMC’s stock price has risen more than 93%, outperforming all of the “Magnificent Seven” stocks except: nvidia.

Despite TSMC’s impressive performance over the past few years, it’s still not too late to buy the stock. And the reason lies in its competitive moat.

Image source: The Motley Fool.

TSMC’s competitiveness lies in its manufacturing capabilities. The goal for semiconductors (chips) used in everyday electronics is to become smaller and more powerful. The more this happens, the better and more efficiently your electronics perform. And when it comes to implementing these advanced chips, no one is better than TSMC.

TSMC is more efficient, has higher yields (the percentage of chips that work as intended), and can produce at greater scale than all of its competitors. That’s why it’s the preferred chip manufacturer for top tech companies like Nvidia. apologize, Amazonand AMD.

Taiwan semiconductor manufacturing industry

today’s change

(-1.86%) $-6.42

current price

$339.56

Key data points

market capitalization

$1.8T

work range

$339.33 – $347.83

52 week range

$134.25 – $390.20

volume

385K

average volume

13M

gross profit

58.73%

dividend yield

1.17%

Most companies will recognize that they can rely on a different, cheaper chipmaker than TSMC, but at the expense of speed and scale. This is why TSMC can use its pricing power to maintain high margins.

Achieving such a dominant position in an important industry almost guarantees continued success. Good business results don’t always correlate with rising stock prices, but TSMC is a stock that we believe will have an upward long-term trajectory.