TSMC (TSM) Outperforms the Market: Key Insights

In the latest trading session, TSMC (TSM) closed at $194.60, reflecting a notable +1.39% increase compared to the previous day's close. This performance surpassed the S&P 500, which gained 0.82% on the same day. In contrast, the Dow Jones Industrial Average experienced a slight decline of 0.22%, while the technology-focused Nasdaq saw a more significant rise of 1.77%.

Over the past month, TSMC's stock has seen a modest increase of 0.09%, lagging behind the Computer and Technology sector, which gained 1.43%, and the S&P 500's increase of 0.80%.

Investors are eagerly anticipating TSMC's upcoming earnings report, with analysts projecting earnings per share (EPS) of $2.17. This would indicate a substantial growth of 50.69% compared to the same quarter last year. Additionally, revenue is estimated to be around $26.46 billion, suggesting a 34.86% increase year-over-year.

For the entire fiscal year, the Zacks Consensus Estimates predict TSMC's earnings will reach $6.97 per share and revenues will amount to $89.51 billion, reflecting increases of 34.56% and 29.17%, respectively, from the last year.

It's also essential for investors to remain informed about any recent changes in analyst forecasts for TSMC. These revisions often highlight shifts in near-term business outlooks. Positive revisions signal analysts' confidence in the company's operational performance and potential profitability.

Our research indicates a strong link between these estimate revisions and short-term stock movements. To leverage this insight, we implemented the Zacks Rank system, which considers these changes to produce a straightforward rating model. This system categorizes stocks from #1 (Strong Buy) to #5 (Strong Sell) and has a proven history of outperforming the market. Stocks rated #1 have delivered an average annual return of +25% since 1988. Over the last month, the Zacks Consensus EPS estimate for TSMC has increased by 1.84%, contributing to TSMC currently holding a Zacks Rank of #1 (Strong Buy).

When examining valuation metrics, TSMC is trading at a Forward P/E ratio of 27.55, which aligns with the average Forward P/E ratio of its industry. Additionally, TSMC has a PEG ratio of 0.88, indicating a favorable valuation in light of its expected earnings growth. The Semiconductor - Circuit Foundry industry also displays an average PEG ratio of 0.88 at the last market close.

Being part of the Computer and Technology sector, the Semiconductor - Circuit Foundry industry holds a Zacks Industry Rank of 1, placing it within the top 1% of over 250 industries. The Zacks Industry Rank evaluates the performance of various industry groups by averaging the Zacks Rank of all stocks in those groups. Historically, the top-rated industries outperform the lower-rated ones by a factor of 2:1.

To stay updated on TSMC's performance in future trading sessions, it’s advisable to closely follow relevant market analyses and updates.

TSMC, Stocks, Market