Taiwan Semi shares gained 45% over the last year - and Goldman just said the chipmaker can do it again
By Steve Goldstein
TSMC shares rose on Monday.
A bullish note from Goldman Sachs analysts on Taiwan Semiconductor Manufacturing Co. lifted shares of the global chip manufacturer in early trade on Monday.
Taiwan Semi's American depository receipts (TSM) rose 3% to $329.07 after Goldman said its new ADR target price was $466, and NT$2,300 for the locally traded shares (TW:2330).
TSMC shares hit an all-time high on Friday and have gained 45% over the last 52 weeks. The new Goldman target implies 46% upside from Friday's close.
"We view AI as a multi-year growth engine for TSMC, with capacity tightness expected to persist through 2027, as exponential growth in token consumption continues to keep silicon demand ahead of supply," said Taipei-based analysts led by Bruce Lu.
The analysts said demand for both the 5 nanometer and 3 nanometer nodes will be "fully loaded" as they now expect 30% revenue growth this year and 28% next year, up from 22% in both years.
Despite higher capex - they see $150 billion over three years - and ongoing capacity expansion, the analysts said TSMC's gross margins are structurally improving and will top 60%, supported by productivity gains and lesser-than-expected overseas fab dilution.
-Steve Goldstein
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01-05-26 0626ET
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