TSMC (TSM) Surpasses Market Returns: Insights to Consider

In the latest trading session, TSMC (TSM) closed at $194.60, marking a positive change of +1.39% from its previous closing price. This performance was notably better than the S&P 500’s daily increase of 0.82%. In contrast, the Dow Jones saw a slight decline of 0.22%, while the technology-focused Nasdaq rose by 1.77%.

Over the past month, TSMC’s stock price has experienced a small uptick of 0.09%. However, it did not keep pace with the broader Computer and Technology sector, which saw a gain of 1.43%, nor did it match the S&P 500’s 0.8% increase.

Investors are particularly eager to see how TSMC performs in its upcoming earnings report. Analysts anticipate earnings per share (EPS) of $2.17, which would represent a notable 50.69% rise compared to the same quarter last year. Furthermore, the consensus estimate projects TSMC’s revenue at $26.46 billion, reflecting a strong upward trend of 34.86% from the previous year’s quarter.

For the entire fiscal year, estimates suggest that TSMC will achieve earnings of $6.97 per share and revenues of $89.51 billion. These figures indicate growth of 34.56% and 29.17%, respectively, compared to last year.

Investors should also keep an eye on recent analyst forecast updates for TSMC, as these changes can signal shifts in current business trends. When analysts revise their estimates upwards, it typically indicates confidence in TSMC’s operational capabilities and profitability potential.

Our analysis suggests that these estimate modifications are closely linked to stock movements in the short term. Hence, the Zacks Rank system has been developed to leverage this trend by incorporating estimate adjustments to provide actionable ratings.

The Zacks Rank, which spans from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of surpassing market performance, with stocks rated #1 yielding an average annual return of +25% since 1988. In the past month, the Zacks Consensus EPS estimate for TSMC has increased by 1.84%, earning the company a Zacks Rank of #1 (Strong Buy).

Examining its valuation metrics, TSMC currently trades at a Forward P/E ratio of 27.55. This is in line with the average Forward P/E of 27.55 for its industry, indicating it is priced comparably to its peers.

Additionally, TSMC has a PEG ratio of 0.88, a metric that combines the P/E ratio with expected earnings growth. The Semiconductor - Circuit Foundry industry is also maintaining an average PEG ratio of 0.88 based on recent close prices.

TSMC is a key player in the Semiconductor - Circuit Foundry segment, which is categorized within the Computer and Technology sector. Notably, this sector holds a Zacks Industry Rank of 1, placing it in the top 1% of over 250 industry categories.

The Zacks Industry Rank evaluates the strength of different industry groups by reviewing the average Zacks Rank of the individual stocks within those groups. Historical data shows that industries in the top half outpace those in the bottom half by a factor of 2 to 1.

To stay updated on TSMC’s performance in future trading sessions, investors can monitor relevant information through various financial platforms.

TSMC, stocks, investment