Emerging Markets Set to Excel: Three Stocks for Growth and Value in 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 11 2025
0mins
Should l Buy TSM?
Source: NASDAQ.COM
Emerging Market Growth: Emerging and developing economies are projected to grow by 4.2% in 2025, significantly outpacing the 1.6% growth expected for advanced economies, with EMs now accounting for over 50% of global GDP.
Equity Market Performance: Emerging-market equities are expected to outperform developed-market equities for the first time since 2020, aided by favorable economic conditions and a significant valuation discount of approximately 35% compared to developed markets.
Key Emerging Market Stocks: Notable stocks such as ICICI Bank, Taiwan Semiconductor, and MercadoLibre are highlighted as strong performers, benefiting from structural tailwinds and expected to show robust growth into 2026.
Monetary Policy and Manufacturing Growth: Easing monetary policies in emerging markets are fostering credit growth and supporting manufacturing activity, with countries like India attracting significant foreign investment and experiencing a surge in mobile phone exports.
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Analyst Views on TSM
Wall Street analysts forecast TSM stock price to fall
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 362.260
Low
63.24
Averages
313.46
High
390.00
Current: 362.260
Low
63.24
Averages
313.46
High
390.00
About TSM
Taiwan Semiconductor Manufacturing Co Ltd is a Taiwan-based integrated circuit foundry service provider. The Company is primarily engaged in integrated circuit manufacturing services. It offers advanced process technologies, specialised process solutions, advanced photomask and silicon stacking, and packaging-related technologies, while supporting a comprehensive design ecosystem. The Company's products serve diverse electronic sectors including artificial intelligence, high-performance computing, wired and wireless communications, automotive and industrial equipment, personal computing, information applications, consumer electronics, smart internet of things, and wearable devices.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
TSMC and US Reach Trade Agreement to Boost Semiconductor Exports
- Trade Agreement Reached: Taiwan and the US reached a trade agreement on February 13, aimed at balancing trade between the two countries, particularly in light of Taiwan's surging AI chip exports, indicating a willingness for technological cooperation.
- Tariff Reduction: The US has lowered tariffs on Taiwanese imports from 20% to 15%, aligning with rates in South Korea and Japan, which will create a more favorable export environment for TSMC, further solidifying its position in the US market.
- Investment Commitment: The Taiwanese government pledged over $250 billion in investments in US semiconductor, energy, and AI production, including TSMC's previously announced $100 billion investment in January, highlighting Taiwan's critical role in the global semiconductor supply chain.
- Analyst Rating Upgrade: On February 13, Gil Luria of D.A. Davidson initiated a Buy rating for TSMC with a $450 price target, emphasizing the company's competitive edge in advanced semiconductor manufacturing as demand continues to surge.
See More
Three AI Stocks Leading Growth Investment
- Market Leader: Nvidia commands approximately 90% of the GPU market, benefiting significantly from AI infrastructure spending due to its cutting-edge chip designs and CUDA software platform, which are expected to drive long-term growth for the company.
- Cost Advantage: Alphabet gains a structural cost advantage by designing its own TPU chips, allowing it to train and run AI models more cheaply than competitors, while also starting to lease TPUs at scale, creating a new revenue stream.
- Industry Monopoly: Taiwan Semiconductor Manufacturing, as the leading chip manufacturer globally, has established a de facto monopoly in advanced chip production due to its unmatched technological expertise and scale, and is expected to maintain strong pricing power moving forward.
- Long-term Investment Value: All three companies trade at reasonable forward P/E ratios, with Nvidia at 23.5, Alphabet at 26.5, and TSMC at 25.5, indicating their potential for long-term investment in the rapidly growing AI market.
See More
Nvidia and Others Poised for Growth from AI Infrastructure Expansion
- Surge in AI Infrastructure Investment: The five largest hyperscalers have committed to spending $700 billion by 2025 to expand cloud capacity, a figure exceeding the GDP of 24 countries, indicating strong demand for AI infrastructure that will drive growth for related companies.
- Nvidia's Market Dominance: Nvidia holds approximately 90% of the GPU market share, with its chips being the primary processors for AI workloads; its cutting-edge chip designs and CUDA software platform have established a strong moat, positioning the company to benefit from the ongoing AI boom.
- Alphabet's Technological Edge: Alphabet boasts the most complete AI tech stack, including the leading large language model Gemini and proprietary TPU chips, enabling it to train and run AI models at lower costs, thereby reinforcing its market leadership.
- TSMC's Growth Potential: As the world's leading chip manufacturer, TSMC is significantly ramping up production capacity and plans to raise prices over the next four years; with its technological expertise and scale, it is expected to maintain a crucial role in the booming AI infrastructure market.
See More
US Stocks Rebound with Nasdaq Leading Gains Amid Easing AI Concerns
- Market Divergence: As of 2026, the S&P 500 is up less than 1%, while international markets (ACWX) have risen about 9%, highlighting a significant divergence that suggests investors should consider the benefits of global portfolio diversification.
- Sector Rotation Trends: Small caps are outperforming large caps, and value stocks are surpassing growth stocks, with emerging markets showing strong performance compared to developed markets, potentially offering new growth opportunities for investors.
- Defensive Investment Strategy: Utility stocks like Duke Energy have risen over 10% year-to-date, with a 3.3% dividend yield and an 18x forward P/E ratio, making them ideal for investors seeking safety amid market volatility while also participating in the AI revolution's power dynamics.
- Future Market Outlook: Although 2026 may face short-term volatility, historical data indicates that markets typically achieve a 100% probability of gains in the second year, with an average return of 27%, encouraging investors to seek growth opportunities in the current environment.
See More
Investment Opportunities in Tech Stocks Amid AI Surge
- Amazon's AI Investment: Amazon plans to invest $200 billion in AI and cloud computing by 2026, and despite a current 20% stock drop, this strategy will enhance its competitive edge in the cloud services market, particularly as AI applications drive demand for its AWS business.
- Salesforce's Market Rebound: Salesforce's stock has fallen to 15 times forward earnings due to AI concerns, yet it is expected to grow earnings by 18% annually over the next three to five years, and its proactive integration of AI features will enhance customer retention, making it a rebound candidate.
- Taiwan Semiconductor's Growth Potential: As the world's leading foundry, Taiwan Semiconductor is projected to grow earnings by 30% annually over the next three to five years, with significant opportunities in AI data centers, and its current stock price is only 25 times this year's earnings estimates, indicating a strong buy signal.
- Impact of AI on the Market: With global data center spending expected to approach $6.7 trillion by 2030, Taiwan Semiconductor, as a major chip supplier, stands to benefit significantly from this trend, solidifying its core position in the global tech industry.
See More
Coatue Management's Notable Investment Shifts in 2025
- Significant Netflix Increase: Coatue Management expanded its Netflix holdings from approximately 618,735 shares to over 10.86 million shares in Q1 2025, reflecting strong confidence in the streaming sector and potentially driving future revenue growth for the firm.
- Lam Research Investment Surge: The fund's allocation in Lam Research grew by 142% year-over-year to 9.81 million shares, indicating a robust expectation for semiconductor equipment demand, which may enhance its market position in the technology sector.
- Emerging Portfolio Expansion: In 2025, Coatue added companies like Oracle, Synopsys, and Snowflake to its portfolio, demonstrating a focus on cloud computing and data analytics, aiming to capitalize on future technological advancements.
- Tesla Holdings Reduction: Despite overall portfolio expansion, Coatue trimmed its Tesla holdings by 24% year-over-year to 1.64 million shares, reflecting a cautious outlook on the electric vehicle market, which could impact its long-term strategic positioning in this sector.
See More
TSMC and US Reach Trade Agreement to Boost Semiconductor Exports
- Trade Agreement Reached: Taiwan and the US reached a trade agreement on February 13, aimed at balancing trade between the two countries, particularly in light of Taiwan's surging AI chip exports, indicating a willingness for technological cooperation.
- Tariff Reduction: The US has lowered tariffs on Taiwanese imports from 20% to 15%, aligning with rates in South Korea and Japan, which will create a more favorable export environment for TSMC, further solidifying its position in the US market.
- Investment Commitment: The Taiwanese government pledged over $250 billion in investments in US semiconductor, energy, and AI production, including TSMC's previously announced $100 billion investment in January, highlighting Taiwan's critical role in the global semiconductor supply chain.
- Analyst Rating Upgrade: On February 13, Gil Luria of D.A. Davidson initiated a Buy rating for TSMC with a $450 price target, emphasizing the company's competitive edge in advanced semiconductor manufacturing as demand continues to surge.
See More
Three AI Stocks Leading Growth Investment
- Market Leader: Nvidia commands approximately 90% of the GPU market, benefiting significantly from AI infrastructure spending due to its cutting-edge chip designs and CUDA software platform, which are expected to drive long-term growth for the company.
- Cost Advantage: Alphabet gains a structural cost advantage by designing its own TPU chips, allowing it to train and run AI models more cheaply than competitors, while also starting to lease TPUs at scale, creating a new revenue stream.
- Industry Monopoly: Taiwan Semiconductor Manufacturing, as the leading chip manufacturer globally, has established a de facto monopoly in advanced chip production due to its unmatched technological expertise and scale, and is expected to maintain strong pricing power moving forward.
- Long-term Investment Value: All three companies trade at reasonable forward P/E ratios, with Nvidia at 23.5, Alphabet at 26.5, and TSMC at 25.5, indicating their potential for long-term investment in the rapidly growing AI market.
See More
Nvidia and Others Poised for Growth from AI Infrastructure Expansion
- Surge in AI Infrastructure Investment: The five largest hyperscalers have committed to spending $700 billion by 2025 to expand cloud capacity, a figure exceeding the GDP of 24 countries, indicating strong demand for AI infrastructure that will drive growth for related companies.
- Nvidia's Market Dominance: Nvidia holds approximately 90% of the GPU market share, with its chips being the primary processors for AI workloads; its cutting-edge chip designs and CUDA software platform have established a strong moat, positioning the company to benefit from the ongoing AI boom.
- Alphabet's Technological Edge: Alphabet boasts the most complete AI tech stack, including the leading large language model Gemini and proprietary TPU chips, enabling it to train and run AI models at lower costs, thereby reinforcing its market leadership.
- TSMC's Growth Potential: As the world's leading chip manufacturer, TSMC is significantly ramping up production capacity and plans to raise prices over the next four years; with its technological expertise and scale, it is expected to maintain a crucial role in the booming AI infrastructure market.
See More
US Stocks Rebound with Nasdaq Leading Gains Amid Easing AI Concerns
- Market Divergence: As of 2026, the S&P 500 is up less than 1%, while international markets (ACWX) have risen about 9%, highlighting a significant divergence that suggests investors should consider the benefits of global portfolio diversification.
- Sector Rotation Trends: Small caps are outperforming large caps, and value stocks are surpassing growth stocks, with emerging markets showing strong performance compared to developed markets, potentially offering new growth opportunities for investors.
- Defensive Investment Strategy: Utility stocks like Duke Energy have risen over 10% year-to-date, with a 3.3% dividend yield and an 18x forward P/E ratio, making them ideal for investors seeking safety amid market volatility while also participating in the AI revolution's power dynamics.
- Future Market Outlook: Although 2026 may face short-term volatility, historical data indicates that markets typically achieve a 100% probability of gains in the second year, with an average return of 27%, encouraging investors to seek growth opportunities in the current environment.
See More
Investment Opportunities in Tech Stocks Amid AI Surge
- Amazon's AI Investment: Amazon plans to invest $200 billion in AI and cloud computing by 2026, and despite a current 20% stock drop, this strategy will enhance its competitive edge in the cloud services market, particularly as AI applications drive demand for its AWS business.
- Salesforce's Market Rebound: Salesforce's stock has fallen to 15 times forward earnings due to AI concerns, yet it is expected to grow earnings by 18% annually over the next three to five years, and its proactive integration of AI features will enhance customer retention, making it a rebound candidate.
- Taiwan Semiconductor's Growth Potential: As the world's leading foundry, Taiwan Semiconductor is projected to grow earnings by 30% annually over the next three to five years, with significant opportunities in AI data centers, and its current stock price is only 25 times this year's earnings estimates, indicating a strong buy signal.
- Impact of AI on the Market: With global data center spending expected to approach $6.7 trillion by 2030, Taiwan Semiconductor, as a major chip supplier, stands to benefit significantly from this trend, solidifying its core position in the global tech industry.
See More
Coatue Management's Notable Investment Shifts in 2025
- Significant Netflix Increase: Coatue Management expanded its Netflix holdings from approximately 618,735 shares to over 10.86 million shares in Q1 2025, reflecting strong confidence in the streaming sector and potentially driving future revenue growth for the firm.
- Lam Research Investment Surge: The fund's allocation in Lam Research grew by 142% year-over-year to 9.81 million shares, indicating a robust expectation for semiconductor equipment demand, which may enhance its market position in the technology sector.
- Emerging Portfolio Expansion: In 2025, Coatue added companies like Oracle, Synopsys, and Snowflake to its portfolio, demonstrating a focus on cloud computing and data analytics, aiming to capitalize on future technological advancements.
- Tesla Holdings Reduction: Despite overall portfolio expansion, Coatue trimmed its Tesla holdings by 24% year-over-year to 1.64 million shares, reflecting a cautious outlook on the electric vehicle market, which could impact its long-term strategic positioning in this sector.
See More
