TSMC Shares Hit Record High Amid Anticipated 2025 Supply Constraints
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TSMC Hits Record Intraday High Following Positive Broker Outlook
Taiwan Semiconductor Manufacturing Co. (TSMC) experienced a surge to a record intraday high in Taipei trading, propelled by an optimistic forecast from Morgan Stanley, which joined a growing list of brokers raising their price targets ahead of the company's upcoming earnings. TSMC's stock climbed as much as 4.5%, contributing to a more than 75% rally for the year.
Broker Optimism and Price Target Boost
Morgan Stanley increased its price target for TSMC shares by approximately 9%, anticipating that the chipmaker would elevate its full-year sales forecast in its upcoming earnings report. The firm's analysts, including Charlie Chan, suggest TSMC might boost wafer prices due to its strong leverage in the market. "TSMC’s ‘hunger marketing’ strategy seems to be effective," noted Morgan Stanley analysts, citing supply chain checks indicating potential tightness in leading-edge foundry supply by 2025.
Analyst Expectations for Revenue Guidance
JPMorgan analysts, led by Gokul Hariharan, also project an increase in TSMC's revenue guidance, predicting a more favorable outlook on AI accelerator demand. The prevailing optimism from Morgan Stanley and JPMorgan aligns with similar sentiments from other brokers, such as Nomura Holdings Inc. and Mizuho Securities Co., ahead of TSMC's second-quarter earnings release.
Revenue Growth and Market Valuation
TSMC, recognized for producing the world's most advanced chips utilized by tech giants like Apple Inc. and Nvidia Corp., is projected to report a 36% revenue growth from the previous year. This marks the fastest growth rate since the last quarter of 2022. This positive earnings forecast has driven the company's shares in Taipei to exceed NT$1,000, roughly equivalent to $31, last week. Additionally, TSMC's market value, when considering American depositary receipts, recently surpassed Berkshire Hathaway Inc., briefly positioning it as the eighth-largest company in the world with a market cap exceeding $950 billion.
