Today, semiconductor giant$Taiwan Semiconductor (TSM.US)$Taiwan stock price hits a new high again.
Intraday, TSMC's stock price rose more than 4%, reaching 1050 New Taiwan dollars, a historical high, and eventually rose 2.99%, with a total market value of 26.84 trillion New Taiwan dollars. Since the beginning of this year, TSMC’s Taiwan stock price has risen more than 75%.
Last Friday, Taiwan Semiconductor's pre-market trading also hit a new high in the US stock market, reaching a maximum of $185.08 and an accumulated increase of over 78% this year. Among large-cap stocks, its annual increase is second only to Nvidia's 154.14%. As of the time of writing, Taiwan Semiconductor's pre-market trading has risen by nearly 4% and hit a new high again!
TSMC's current total market value has reached $954.248 billion, approaching $1 trillion, ranking eighth in the US stock market, surpassing Berkshire Hathaway and Tesla under Buffett.
Wall Street is bullish.
Based on the expected increase in chip prices, Wall Street is bullish on TSMC's performance growth.
Morgan Stanley maintained its overweight rating on TSMC and raised its target price from 1080 New Taiwan dollars to 1180 New Taiwan dollars, an increase of 9.3%. The reason is the sustainable expectation of AI semiconductor demand and the trend of rising wafer prices.
In a report on Sunday, Morgan Stanley analysts wrote: TSMC's 'hungry marketing' strategy seems to be working. Our latest supply chain survey shows that TSMC is conveying a message that supply may be tight in 2025, and if customers do not value TSMC's value, they may not be able to obtain sufficient capacity allocation.
Morgan Stanley believes that TSMC raised wafer prices because of its strong bargaining power.
In the latest report, Macquarie Securities also pointed out that according to supply chain visits, most TSMC customers have agreed to raise foundry prices in exchange for reliable supply, which will further drive TSMC's gross margin higher.
According to analysts' estimates, TSMC's gross margin will rise to 55.1% in 2025; it will approach 60% in 2026, reaching 59.3%; this year's gross margin has been raised to 52.6%.
Due to the growing profit prospects, Macquarie retained TSMC's 'outperform the market' rating and raised TSMC's target price on the Taiwan stock market by 28%, to 1280 New Taiwan dollars, more than today's closing price by more than 23% upside.
In addition, Goldman Sachs raised TSMC's target price by 19% to 1160 New Taiwan dollars, and expects the prices of 3nm and 5nm chips to rise by 'low single-digit percentage.'
Also bullish on TSMC are HSBC with a target price of 1370 New Taiwan dollars, Citigroup with 1150 New Taiwan dollars, Barclays with 1096 New Taiwan dollars, and JPMorgan with 1080 New Taiwan dollars.
Strong earnings prospects
On July 18th, TSMC will disclose its second-quarter performance for fiscal year 2024.
The market expects TSMC's second-quarter revenue to increase by 36% year-on-year, the fastest growth rate since the fourth quarter of 2022.
Bloomberg industry research predicts that the company's revenue will exceed market expectations by 10% and lead performance in the China-Taiwan wafer foundry industry.
JPMorgan expects that TSMC may 'raise its 2024 revenue forecast and may increase capital expenditures to the high end of expectations,' and expects AI to account for 35% of total revenue by 2028.
Edited by Jeffrey