Is Taiwan Semiconductor Stock Worth Buying Post Its 80% YTD Rally?

Zacks11-19

Taiwan Semiconductor Manufacturing Company Ltd. TSM, the global leader in semiconductor foundry services and also known as TSMC, has delivered an astounding 80% rally in its stock price year-to-date. ...

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TSM, the global leader in semiconductor foundry services and also known as TSMC, has delivered an astounding 80% rally in its stock price year-to-date. ...</p>\n\n<a href=\"https://finance.yahoo.com/news/taiwan-semiconductor-stock-worth-buying-130200250.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Is Taiwan Semiconductor Stock Worth Buying Post Its 80% YTD Rally?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nIs Taiwan Semiconductor Stock Worth Buying Post Its 80% YTD Rally?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-19 21:02 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/taiwan-semiconductor-stock-worth-buying-130200250.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Taiwan Semiconductor Manufacturing Company Ltd. TSM, the global leader in semiconductor foundry services and also known as TSMC, has delivered an astounding 80% rally in its stock price year-to-date. ...</p>\n\n<a href=\"https://finance.yahoo.com/news/taiwan-semiconductor-stock-worth-buying-130200250.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"INTC","symbol_name":"英特尔","start_time":0,"source_url":"https://finance.yahoo.com/news/taiwan-semiconductor-stock-worth-buying-130200250.html","article_id":"2484926712","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/esGBzeXBQnzFt0oz8IPN6w--~B/aD0zNDk7dz02MjA7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/f8e8dd74fec7b16eb85235be391efa80"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2484926712","pubTimestamp":1732021320,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Taiwan Semiconductor Manufacturing Company Ltd. TSM, the global leader in semiconductor foundry services and also known as TSMC, has delivered an astounding 80% rally in its stock price year-to-date. This surge has outpaced the broader market, with the S&P 500 and the Zacks Computer & Technology sector rising 23.4% and 25.7%, respectively.Taiwan Semiconductor’s 80% YTD surge is underpinned by its impressive financial performance and technological leadership. In the first three quarters of 2024, TSMC consistently beat earnings estimates, driven by its pivotal role in powering the AI and HPC revolutions. Taiwan Semiconductor’s advanced process nodes, particularly 3nm and 5nm technologies, have been in high demand, contributing 20% and 32% of wafer revenues in the third quarter of 2024, respectively.Smartphones, another key segment, accounted for 34% of revenues. With modest growth in global smartphone unit volumes expected in 2024, TSMC’s advanced chips remain essential to powering flags","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"INTC":"英特尔","POST":"Post Holdings","LU0203201768.USD":"AB SICAV I - ALL MARKET INCOME PORTFOLIO \"AX\" (USD) INC","NVDX":"T-REX 2X LONG NVIDIA DAILY TARGET ETF","IE00BMCWC346.EUR":"GUINNESS EMERGING MARKETS EQUITY INCOME \"C\" (EUR) ACC","LU0096364046.USD":"CT (LUX) I AMERICAN \"DU\" (USD) ACC","LU1674673691.USD":"HSBC GIF GLOBAL LOWER CARBON EQUITY \"AD\" (USD) INC","NVDY":"YIELDMAX NVDA OPTION INCOME STRATEGY ETF","LU1868837722.USD":"CT (LUX) I GLOBAL EMERGING MARKET EQUITIES \"2\" (USD) ACC","LU0289960550.SGD":"AB FCP I - GLOBAL EQUITY BLEND PORTFOLIO 'A' (SGD) ACC","NVDU":"Direxion Daily NVDA Bull 2X Shares","IE00BQXX3F31.USD":"GUINNESS GLOBAL INNOVATORS \"C\" (USD) ACC","NVD2.UK":"2X NVIDIA ETP","SNVD.UK":"LS -1X NVIDIA","NVD3.UK":"LS 3X NVIDIA","TSM":"台积电","IE00BJTD4N35.SGD":"Neuberger Berman US Long Short Equity A1  Acc SGD-H","NVDS.UK":"LS -1X NVIDIA","IE00B7KXQ091.USD":"Janus Henderson Balanced A Inc USD","NVDS":"Tradr 1.5X Short NVDA Daily ETF","LU0541501648.USD":"ALLSPRING  EMERGING MARKETS EQUITY \"A\" (USD) ACC","LU2403377893.USD":"ALLIANZ SELECT INCOME AND GROWTH \"AM\" (USD) INC","LU1815336760.USD":"THREADNEEDLE (LUX) GLOBAL TECHNOLOGY \"AUP\" (USD) INC","03145":"华夏亚洲高息股","NVD":"GraniteShares 2x Short NVDA Daily ETF","NVDD":"Direxion Daily NVDA Bear 1X Shares","LU2430703095.HKD":"WELLINGTON MULTI-ASSET HIGH INCOME \"AM4\" (HKD) INC","LU2065171402.SGD":"M&G (LUX) GLOBAL MAXIMA \"A\" (SGD) INC","BK4592":"伊斯兰概念","AVGO":"博通","LU2491050154.USD":"WELLINGTON SUSTAINABLE OUTCOMES \"A\" (USD) ACC","LU1670628061.USD":"M&G (LUX) NORTH AMERICAN DIVIDEND \"A\" (USD) INC","LU0072462426.USD":"贝莱德全球配置 A2","LU2360106780.USD":"BGF WORLD TECHNOLOGY \"A4\" (USD) INC","LU2237443549.SGD":"Aberdeen Standard SICAV I - Global Dynamic Dividend A MIncA SGD-H","LU2360107168.USD":"BGF NEXT GENERATION TECHNOLOGY \"A4\" (USD) INC","GB00BDT5M118.USD":"天利环球扩展Alpha基金A Acc","LU1242518857.USD":"FULLERTON LUX FUNDS - ASIA ABSOLUTE ALPHA \"I\" (USD) ACC","IE00BJJMRY28.SGD":"Janus Henderson Balanced A Inc SGD","LU1935042215.USD":"MANULIFE GF GLOBAL MULTI-ASSET DIVERSIFIED INCOME  \"AA\" (USD) INC A","LU0308772762.SGD":"Blackrock Global Allocation A2 SGD-H","3NVD.UK":"LS 3X NVIDIA","IE00BKPKM429.USD":"NEUBERGER BERMAN GLOBAL SUSTAINABLE EQUITY \"A\" (USD) ACC","LU0965509010.AUD":"AB LOW VOLATILITY EQUITY PORTFOLIO \"AD\" (AUDHDG) INC","IE00B19Z9Z06.USD":"Legg Mason ClearBridge - US Aggressive Growth A Acc USD","LU0175139822.USD":"AB FCP I Global Equity Blend A USD","NVDA":"英伟达","LU0057025933.USD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"AX\" (USD) ACC","2NVD.UK":"2X NVIDIA ETP"},"translate_title":"台积电股票年初至今上涨80%后值得买入吗？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"INTC":1,"NVDA":1,"AVGO":1,"POST":1,"TSM":0.9,"NVD":0.6,"NVDY":0.6,"NVD2.UK":0.6,"NVD3.UK":0.6,"SNVD.UK":0.6,"NVDD":0.6,"NVDS":0.6,"NVDS.UK":0.6,"NVDU":0.6,"NVDX":0.6,"2NVD.UK":0.6,"3NVD.UK":0.6,"03145":0.6},"content_text":"Taiwan Semiconductor Manufacturing Company Ltd. TSM, the global leader in semiconductor foundry services and also known as TSMC, has delivered an astounding 80% rally in its stock price year-to-date. This surge has outpaced the broader market, with the S&P 500 and the Zacks Computer & Technology sector rising 23.4% and 25.7%, respectively.\nYTD Price Return Performance\nImage Source: Zacks Investment Research\nInvestors may question whether this rally leaves room for further upside or if the stock has reached its peak. However, Taiwan Semiconductor’s technological leadership, robust financials and strategic positioning in high-growth areas like artificial intelligence (AI) and high-performance computing (HPC) suggest it’s still a buy.\nA Look at TSM’s Impressive Rally\nTaiwan Semiconductor’s 80% YTD surge is underpinned by its impressive financial performance and technological leadership. In the first three quarters of 2024, TSMC consistently beat earnings estimates, driven by its pivotal role in powering the AI and HPC revolutions. Taiwan Semiconductor’s advanced process nodes, particularly 3nm and 5nm technologies, have been in high demand, contributing 20% and 32% of wafer revenues in the third quarter of 2024, respectively.\nIn the same quarter, TSMC delivered stellar financial results, with revenues climbing 36% year over year to $23.5 billion and net income surging 51% to $10.06 billion. Gross margins improved to 57.8%, a 350-basis point increase, showcasing Taiwan Semiconductor’s ability to scale profitably despite rising operational costs.\nSuch impressive metrics highlight the company’s unparalleled efficiency and critical role in supplying chips for AI applications, smartphones and data centers.\nTSMC’s Fundamentals Remain Strong\nTaiwan Semiconductor’s ability to innovate is unmatched. Its 3nm and 5nm process nodes dominate the market, powering chips for AI, cloud computing and next-gen smartphones. The company’s ongoing development of 2nm technology, expected to deliver up to 30% power savings, cements its leadership.\nMoreover, with AI adoption accelerating across industries, demand for high-performance chips is surging. TSMC’s leadership in manufacturing AI-specific chips positions it as a major beneficiary of this trend. AI and HPC platforms now account for more than 51% of the company’s revenues, underscoring their critical importance. AI-related server processors are expected to triple in demand by the end of 2024, providing TSMC with a significant runway for growth.\nWhile AI and HPC drive a substantial portion of revenues, TSMC also benefits from strong demand in automotive and IoT applications. Automotive chips contributed 5% of revenues in the third quarter of 2024, supported by trends like electric vehicle adoption and autonomous driving.\nSmartphones, another key segment, accounted for 34% of revenues. With modest growth in global smartphone unit volumes expected in 2024, TSMC’s advanced chips remain essential to powering flagship devices from major manufacturers.\nTaiwan Semiconductor's powerful customer base is another positive. Tech giants, including NVIDIA NVDA, Amazon Web Services, Broadcom AVGO, Intel INTC and Qualcomm, are among some of its biggest customers. In 2023, 70% of TSMC’s revenues came from just 10 major customers, and this growing relationship with industry leaders bodes well for future top-line growth. As companies continue to rely on TSM for their most advanced chips, these long-term partnerships ensure a stable and growing revenue base for the semiconductor giant.\nTaiwan Semiconductor’s Promising Outlook\nTaiwan Semiconductor’s outlook for the fourth quarter is incredibly optimistic. The company projects revenues between $26.1 billion and $26.9 billion, implying a 35% year-over-year increase at the midpoint. Its gross margins are expected to remain strong at 57% to 59%, supported by higher capacity utilization and continued demand for its 3nm and upcoming 2nm nodes. These advanced technologies ensure that TSMC remains at the forefront of semiconductor innovation.\nMoreover, Taiwan Semiconductor continues to deliver robust cash flow, posting $37.62 billion in the first three quarters of 2024. With capital expenditures set to exceed $30 billion for the full year, TSM is strategically investing in future growth, ensuring it can meet the rising demand from AI, 5G and the automotive industry.\nThe Zacks Consensus Estimate for the current and next year depicts continued growth momentum for Taiwan Semiconductor.\nImage Source: Zacks Investment Research\nDespite its remarkable rally, Taiwan Semiconductor is not overvalued. The stock trades at a forward price-to-earnings (P/E) ratio of 21.85, below the sector average of 26.30. This reasonable valuation, coupled with the company’s growth potential, offers an appealing entry point for investors seeking exposure to the semiconductor sector.\nImage Source: Zacks Investment Research\nConclusion: TSM Stock Remains a Buy\nTaiwan Semiconductor’s 80% YTD rally is a testament to its dominance in the semiconductor industry. The company’s leadership in advanced manufacturing, strong financial performance and strategic positioning in AI and HPC ensure its relevance in a rapidly evolving market.\nDespite its impressive run, TSMC’s valuation remains reasonable, making the stock a compelling buy. With a strong outlook for the fourth quarter, including projected revenue growth of 35%, the momentum is likely to continue. For investors seeking long-term growth in the booming semiconductor space, this Zacks Rank #1 (Strong Buy) semiconductor stock stands out as an opportunity worth seizing. You can see the complete list of today’s Zacks #1 Rank stocks here.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nIntel Corporation (INTC) : Free Stock Analysis Report\nNVIDIA Corporation (NVDA) : Free Stock Analysis Report\nBroadcom Inc. (AVGO) : Free Stock Analysis Report\nTaiwan Semiconductor Manufacturing Company Ltd. (TSM) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":1,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2484926712"}