Taiwan Semiconductor Manufacturing (TSM) stock is soaring Thursday and is on track to close with a trillion-dollar market cap for the first time ever. This comes after the integrated circuits and chip manufacturer beat top- and bottom-line expectations for its third quarter and issued a strong outlook for its fourth quarter.
In the three months ended September 30, the Taiwan-based company, whose clients include Magnificent 7 stocks Nvidia (NVDA) and Apple (AAPL), said net revenue increased 36% year-over-year to $23.5 billion. Earnings per share (EPS) were up 50.4% from the year-ago period to $1.94.
The results exceeded analysts' expectations for revenue of $23.1 billion and EPS of $1.80, according to Yahoo Finance.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"Our business in the third quarter was supported by strong smartphone and AI-related demand for our industry-leading 3 nanometer and 5 nanometer technologies," said Taiwan Semiconductor Chief Financial Officer Wendell Huang in a statement. "Moving into fourth quarter 2024, we expect our business to continue to be supported by strong demand for our leading-edge process technologies."
For Q4, TSM said it anticipates revenue in the range of $26.1 billion to $26.9 billion. This is well ahead of the $24.9 billion in sales Wall Street is anticipating.
Is Taiwan Semiconductor stock a buy, sell or hold?
Taiwan Semiconductor has had a stellar run on the price charts in 2024, more than doubling in value for the year to date. Unsurprisingly, analysts are very bullish on the semiconductor stock.
According to S&P Global Market Intelligence, the average analyst target price for TSM stock is $219.01, representing implied upside of nearly 4% to current levels. Additionally, the consensus recommendation is Strong Buy.
Speaking for the bulls is financial services firm Needham, which has a Buy rating and $210 price target on TSM stock.
"We look for TSMC's revenue growth, primarily driven by steady introductions of new technology nodes that are largely unaffected by industry cyclicality, to remain strong and support a 15-20% earnings compound annual growth rate (CAGR) over the next few years," says Needham analyst Charles Shi. "As such, we recommend TSM stock as a core holding for investors who look to invest in semiconductors, which we view as the foundation of the expanding digital economy."
Related Content
-
S&P 500 Hits New Highs as Rally Resumes: Stock Market TodayTech stocks were the biggest gainers on Wall Street today, with Nvidia and Dell making notable moves.
-
The Shutdown Standoff Is Heading for Its Next Big TestA key mid-October deadline could intensify the shutdown fight in Washington, and the fallout could soon hit workers and your wallet.
-
S&P 500 Hits New Highs as Rally Resumes: Stock Market Today
Tech stocks were the biggest gainers on Wall Street today, with Nvidia and Dell making notable moves.
-
Should You Buy Gold as It Tops $4,000? Here's What the Experts SayRate cuts, a weak dollar and macro uncertainty have helped create a "perfect storm" for gold this year. Should investors add exposure or is it too late to buy?
-
Preferred Bank Stocks: The Investment Retirees (and Others) May Be Missing Out OnMost large banks issue preferred stocks that pay out fixed dividends, often with higher yields than bonds. Should you make room for them in your portfolio?
-
Don't Let Your Equity Compensation Trip You Up: A Financial Expert's GuideStock options, RSUs and other executive perks can come with some serious strings attached. To avoid a nasty tax surprise, you need a plan.
-
Rally Fades on Mixed AI Revolution News: Stock Market TodayAll three main U.S. equity indexes opened higher but closed lower as a seven-session winning streak for the S&P 500 came to an end.
-
The Spendthrift Trap: Here's One Way to Protect Your Legacy From an Irresponsible HeirA spendthrift clause in an estate plan can protect an inheritance from a financially irresponsible child's debts and poor decisions.
-
Adapting to AI's Evolving Landscape: A Survival Guide for BusinessesLike it or not, AI is here to stay, and opting out could be disastrous for your organization. Instead, focus on what you can control and be flexible, as AI is still evolving.
-
S&P, Nasdaq Hit New Highs: Stock Market TodayA late-day rally wasn't enough to lift the Dow into the green as its six-session winning streak came to an end.
