TSMC Nears $1 Trillion Valuation as Target Upgrades Drive Rally

(Bloomberg) — The bullish chorus on Taiwan Semiconductor Manufacturing Co. is growing even louder as a stock rally pushes its market cap closer to the $1 trillion mark.

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Many Wall Street brokerages raised their price targets for TSMC this week, citing strong AI-related demand and potential price hikes in 2025 to boost earnings. Goldman Sachs Group Inc. is the most bullish of all, raising its price target 19% to NT$1,160 as it sees manufacturing prices for three- and five-nanometer chips rising by a “low single-digit percentage.” “.

JPMorgan Chase & Co. says TSMC could “raise its 2024 revenue forecast and potentially increase investments to the upper end of the forecast range,” and expects AI to contribute 35%. of total sales by 2028. Citigroup Inc. and Morgan Stanley also raised their price targets on stronger earnings prospects.

The foundry industry leader has become a major beneficiary of the widespread adoption of artificial intelligence, with its cutting-edge technology and valuation making it a favorite among global investors. TSMC has also thrived as Nvidia Corp.’s main supplier of advanced chips. – recently crowned the world’s most valuable company.

TSMC overtook Berkshire Hathaway Inc. last week to become the world’s eighth-largest company by market capitalization, based on U.S.-listed ADRs. The 73% rise in certificates of deposit this year brought the company’s market value to $932 billion, less than the $1 trillion threshold.

“We now see an even more attractive risk-reward for TSMC amid growing positive sentiment around AI,” Goldman analysts including Bruce Lu wrote on Tuesday. “With the continued proliferation of AI , we see TSMC among the main beneficiaries.”

(Updated with additional details from analyst reports.)

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