President Donald Trump’s tariffs have two primary objectives. One is to rebalance the world trade order, which he believes is stacked against the United States due to the ballooning deficits that the U.S. has with its trading partners. The second mission, however, has more far-reaching consequences. That is to shore up the manufacturing prowess of the U.S. Although this is no small feat, Trump’s initiative is finding favor among some big names across industries.

Notable among them are chip manufacturing giant Taiwan Semiconductor (TSM) and pharmaceutical giant Eli Lilly (LLY).

TSMC has announced a $100 billion investment in U.S. manufacturing and job creation which “includes plans for three new fabrication plants, two advanced packaging facilities and a major R&D team center.” Eli Lilly is planning to set up four new manufacturing facilities across the U.S.

Plus, both stocks earn “Strong Buy” consensus ratings from analysts. Let’s find out why! 

Stock #1: Eli Lilly 

Eli Lilly is a leading global pharmaceutical firm that specialises in the development and marketing of drugs across various therapeutic areas. The company has operations in over 18 countries with products marketed in approximately 125 countries.

Valued at a market cap of $786 billion, the LLY stock is up 11.4% on a YTD basis.

The company has reported revenue and earnings compound annual growth rates (CAGRs) of 8.67% and 16.05%, respectively, over the last 10 years.

Notably, the most recent quarter saw Lilly’s numbers come in ahead of Street estimates, with revenues witnessing a considerable jump of 45% to $13.53 billion as key drug Mounjaro's sales grew by 60% from the prior year to $3.5 billion. Earnings shot up by 113.7% in the same period to $5.32, easily outpacing the consensus estimate of $5.04.

Meanwhile, Eli Lilly has reported promising developments with the unveiling of initial Phase 3 trial outcomes for orforglipron, its novel treatment targeting both diabetes and weight management. The drug not only successfully achieved its primary goal related to A1C reduction, a key marker for glycemic control in diabetic patients, but also demonstrated a notable 7.9% reduction in body weight over a 40-week period at the highest tested dosage.

Looking ahead, the company’s strategic trajectory appears robust, supported by a broad pipeline. 

Among its late-stage candidates is lebrikizumab, a biologic aimed at addressing eczema and atopic dermatitis. As the third such treatment in its category, projections suggest it could generate approximately $6 billion in annual sales across the G7 nations by the end of the decade. Additionally, Lilly’s acquisition of Morphic Holding in 2024 has expanded its pipeline with the inclusion of MORF-057, a small-molecule oral inhibitor now in Phase 2 trials for conditions such as ulcerative colitis and Crohn’s disease, potentially deepening its foothold in the immunology space.

Consequently, analysts are predicting that Lilly's forward revenue and earnings growth rates of 28.04% and 69.28 will exceed the sector medians of 7.89% and 14.81%, respectively.

Overall, analysts have earmarked a rating of “Strong Buy” for the stock with a mean target price of $1,018.71, which denotes upside potential of about 18.5% from current levels. Out of 25 analysts covering the stock, 21 have a “Strong Buy” rating, one has a “Moderate Buy” rating, and three have a “Hold” rating.

Stock #2: Taiwan Semi 

TSMC is the world’s largest dedicated semiconductor foundry. It pioneered the “pure-play” foundry model, focusing solely on manufacturing chips designed by other companies like Nvidia (NVDA), Advanced Micro Devices (AMD), and Qualcomm (QCOM), among others.

Valued at a market cap of $818 billion, TSM stock is down 16.9% on a YTD basis. 

Notably, the latest quarterly results showcased a strong performance from the company, with Taiwan Semi surpassing expectations on both the top and bottom lines. For the first quarter of fiscal 2025, revenue reached $25.53 billion, translating to a 35.3% year-over-year increase, while earnings surged by an even more substantial 53.6% to $2.12 per share, outperforming the consensus projection of $2.07. It's worth noting that over the last 16 quarters, the company has fallen short of earnings forecasts only twice, underscoring a consistent track record of financial execution. Additionally, when measured in New Taiwan dollars, net income exhibited an even stronger annual rise of 60%, reinforcing the firm’s earnings momentum.

Looking ahead, the company anticipates second-quarter 2025 revenue to fall within the range of $28.4 billion to $29.2 billion. The midpoint of this guidance implies a 38.3% increase compared to the prior year, signaling persistent robust demand for its offerings and sustained business expansion.

As noted in my earlier assessment, the criticality of TSMC's operations and its dominant market position, makes it a compelling choice for investors.

Further, management’s robust Q2 revenue forecast and commitment to capital expenditures suggest confidence in long-term growth despite tariff uncertainties.

Thus, analysts are predicting forward revenue and earnings growth rates of 24.57% and 27.55%, much higher than the sector medians of 6.71% and 10.11%.

Overall, analysts have deemed the stock a “Strong Buy” with a mean target price of $231.25 which denotes upside potential of about 37.5% from current levels. Out of 11 analysts covering the stock, eight have a “Strong Buy” rating, two have a “Moderate Buy” rating, and one has a “Hold” rating.