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.
Sign up for Kiplinger’s Free E-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
-
Stocks Struggle to Start Nvidia Week: Stock Market TodayAnother important week for the stock market starts on a risk-off note.
-
I'm a Financial Pro: Why You Shouldn't Put All Your Eggs in the Company Stock BasketLimit exposure to your employer's stock, sell it periodically and maintain portfolio diversification to protect your wealth from unexpected events.
-
How Will the One Big Beautiful Bill Shape Your Legacy?The One Big Beautiful Bill Act removes uncertainty over tax brackets and estate tax. Families should take time to review estate plans to take full advantage.
-
Nvidia Earnings: Live Updates and Commentary August 2025Nvidia's earnings event is just days away, and market participants are zeroed in on the AI bellwether's quarterly results.
-
Should You Claim Social Security Early or Late? A Financial Adviser Weighs InThere isn't a wrong age to start claiming Social Security, but there are factors that everyone should consider to avoid leaving money on the table.
-
Three Things Financially Confident People Do, From a Pro Who KnowsIf you have any worries about your retirement future, take back control with these three tips.
-
How Much Do I Need to Retire? A Financial Professional Breaks Down Your OptionsWhat it all boils down to is will you be comfortable in retirement? Some people may rely on formulas, while others just aim for $1 million nest egg.
-
Despite Our Grumbles, America Still Delivers on the Dream: Perspective From a Financial Pro Who's Seen StuffSome of us might complain about the state of our nation (and those concerns are legit), but America still offers unparalleled opportunities and mobility that many people around the world only dream about.
