Shares in Taiwan Semiconductor Manufacturing Co. (TSMC) were weighed down by geopolitical developments in the United States last week, even as the company reported a profit that beat expectations. TSMC and other semiconductor stocks fell last Wednesday after reports surfaced about possible tightening of restrictions. Bloomberg reported on Wednesday that the Biden administration is considering a broad rule to crack down on companies that export critical chipmaking equipment to China. TSMC’s second-quarter financial report shows that in the second quarter of 2024, mainland China accounted for 16% of TSMC’s net revenue, up from 9% in the first quarter. Revenue from North America accounted for 65%, the report said. Former President Trump said in an interview published on Tuesday that Taiwan should pay the United States for defense costs, and claimed that Taiwan accounts for “about 100%” of the United States' semiconductor business. On Thursday, TSMC reported second-quarter earnings that beat revenue and profit expectations. As of the close of trading on July 19, the company's stock price fell by approximately 6.7% last week. Where do stocks go from here? CNBC Pro takes a look at what Wall Street has to say. Following these developments, 22 of 42 analysts covering TSMC's Taiwan-listed shares raised their price targets on the stock on July 18-19, according to FactSet. None lowered or kept price targets unchanged. Based on the consensus price target, analysts see potential upside of 30.5% for the stock. TSMC's shares are also listed in the United States. In a report on July 15, Needham raised the target price of TSMC's U.S.-listed shares from $168 to $210 and said it expected the company's foundry business to strengthen because “Competitive competition is not expected.” Needham analysts said: “Capital efficiency has been TSMC's primary focus, and all signs point to capital discipline continuing into 2025.” He forecast TSMC's free cash flow will quadruple from 2023 to 2025. That could mean more upside for dividend increases, they said. Morningstar said in a note that the direct impact on TSMC from Trump's negative comments about Taiwan and reports of possible new export restrictions should be limited because most of its direct customers are from the United States or Taiwan. “We view this week’s pullback as an entry point for investors looking for a cheap way to gain exposure to AI and overall semiconductor growth,” the company said in a July 19 report. “Artificial Intelligence Chip Advanced Packaging, Management Says Capacity shortages should persist into 2025. We believe the risk of oversupply remains modest as non-AI related expansion plans remain largely unchanged,” Morningstar added. However, Morgan Stanley made negative noises. It removed stocks such as TSMC from its focus list. However, it remains overweight TSMC. —CNBC’s Michael Bloom and Arjun Kharpal contributed to this report.