April 10 - Taiwan Semiconductor Manufacturing Co. (TSM, Financial) is teaming up with Intel (INTC, Financial) on a new U.S.-based joint venture aimed at expanding domestic chipmaking, as both government incentives and geopolitical tensions shape the industry's direction.
Schwab Network commentator George Tsilis said the move makes strategic sense, noting that Intel's manufacturing presence in the U.S. provides Taiwan Semi with an efficient entry point into onshore production.
Tsilis, a former CME economist and financial advisor at BMO, added that the initiative aligns with the Biden administration's subsidies for domestic chipmakers and the Trump campaign's calls to ramp up high-end U.S. manufacturing.
He also flagged concerns about the broader equity market, saying a potential rebound would hinge on tariff relief. Even then, weak consumer sentiment and falling earnings estimates could weigh on investor confidence.
While Intel is positioned to benefit from the AI buildout, Tsilis suggested that other names in the sector, particularly those trading below five times earnings, may offer better near-term returns.
