The stock's valuation has risen, but its outlook remains bright.
TSMC just crossed the trillion-dollar mark.
Taiwan Semiconductor Manufacturing Company Limited's stock has risen considerably over the past 12 months. The company's strong moat, operational excellence, and robust growth have fueled investor optimism. TSMC is one of my stocks to own forever.
TSM's strong Q3 earnings, advanced technology leadership and robust growth outlook make it a compelling buy right now.
The world's most advanced chipmaker still has a lot of room to grow.
$1 trillion may be just a milestone in this company's continued growth amid the AI boom.
TSM is undervalued despite nearing all-time highs, driven by strong AI demand that has helped maintain its 30%+ YoY revenue growth trajectory, significantly exceeding the guided 5-year CAGR. The management sees growing demand for lower nanometer ramps, as 3nm accounts of 20% of revenue mix in 3Q, up from 9% in 1Q FY2024. The company continues to significantly expand its margins, providing a higher sequential margin outlook for 4Q, driven by high utilization rates, but warned some pressure in FY2025.
TSMC's Q3 earnings exceeded expectations with $10.1 billion net income and $23.5 billion revenue, driven by strong smartphone demand and advanced artificial intelligence hardware. I maintain a "buy" recommendation, even though TSMC's forward valuation metrics now favor competitors like Qualcomm, suggesting a need for cautious trading. The stock's recent break above $193.47 is bullish, but RSI nearing overbought territory indicates potential momentum slowdown; wait for retracement opportunities.
This chip manufacturer sees a bright future for AI.
Mid-October brought a flurry of earnings results from major semiconductor firms like Taiwan Semiconductor Manufacturing Co. NYSE: TSM and ASML Holding N.V. NASDAQ: ASML, plus reports from several big banks, Netflix Inc. NASDAQ: NFLX, American Express Co. NYSE: AXP, and many others.
The semiconductor company reported results that ignited investor enthusiasm.
Taiwan Semiconductor Manufacturing Company (NYSE: TSM), the world's largest contract chipmaker, continues to make waves in the semiconductor industry with its remarkable performance in the third quarter of 2024.