Forget Taiwan Semiconductor: 2 AI Semiconductor Equipment Stocks to Buy and Hold Instead

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Skip Taiwan Chips, Buy Semiconductor Equipment Leaders

ASML and Applied Materials offer safer, faster growth than Taiwan Semiconductor due to geopolitical risks.

Taiwan Semiconductor Manufacturing (TSMC) dominates chip production but sits under a geopolitical shadow that South African investors can't ignore. The risk of disruption from Taiwan's tensions with China is real—even if a conflict seems unlikely. Instead, equipment makers like ASML and Applied Materials are better bets. ASML is the only company that builds EUV lithography machines essential for the newest chips, benefiting from a near-monopoly and steady 17% annual revenue growth. Applied Materials serves various chip makers with a broad equipment range and projects accelerating growth driven by AI chip demand. Both have safer geographic locations compared to TSMC's Taiwan base. For JSE investors, this matters because USD/ZAR volatility often reacts to risk-off moves tied to geopolitical shocks. These equipment suppliers should handle external shocks better, making them the smarter long-term exposure to semiconductor growth. The risk? A sudden easing in Taiwan-China tensions could boost TSMC disproportionately, leaving these names trailing. this is just our opinion and not financial advice