Even with Taiwan Semiconductor Manufacturing Co. reaching record levels, analysts believe that its upcoming quarterly results could push the stock even higher due to better-than-expected sales in the latest quarter. The company, known for producing chips for Nvidia Corp. and other tech giants, is poised to benefit from the increasing demand for artificial intelligence-related technologies. This growth is driven by ongoing upgrades in chip technology, despite uncertainties in the smartphone and consumer electronics market.
TSMC’s valuation remains conservative compared to other semiconductor companies, trading at less than 17 times expected earnings for next year. The company’s revenue and capital expenditure forecasts are eagerly awaited, as they are seen as an indicator of the demand for advanced chip technology. TSMC’s expansion into the US, Japan, and Germany is also seen as a strategic move to diversify its manufacturing base amid geopolitical tensions.
Analysts see TSMC’s dominance in cutting-edge chips as undervalued, particularly in light of recent developments such as receiving grants for factories in Arizona. Despite concerns about geopolitical risks, the positive outlook for TSMC is reflected in the bullish sentiment among investors and analysts. The company’s commitment to meeting global demand while maintaining high technological standards positions it well for sustained growth and potential stock appreciation.