Goldman Sachs, a prominent US financial institution, has shown a positive outlook on Taiwan Semiconductor Manufacturing Company Limited (TSMC). Recently, TSMC’s stocks have surged over 68% in value. This has led Goldman Sachs to add TSMC to its “Conviction Buy” list, highlighting its robust participation in the rapidly growing artificial intelligence industry.
How is TSMC Positioned in the AI Industry?
TSMC stands as Taiwan’s largest corporation and is a globally recognized semiconductor producer, supplying leading tech companies such as Apple, Nvidia, and Qualcomm. The firm’s shares serve as a significant gauge of growth within the semiconductor sector. A key aspect of TSMC’s strategy includes significant investment in CoWoS technology, crucial for high-performance computing and AI, enhancing its role as a pivotal entity in AI and data center industries.
What Does Goldman Sachs Predict for TSMC?
Goldman Sachs noted that TSMC’s forward strides in cutting-edge technology could bolster its medium-term growth. A reduction in concerns over large AI chip orders and heightened interest in CoWoS are seen as pivotal drivers that are expected to elevate the company’s product demand.
“We expect TSMC’s dollar-based revenue to increase by 29% this year and 17% by 2026,” Goldman Sachs noted.
Moreover, potential engagements with smartphone, server, and network infrastructure companies are anticipated due to growing curiosity in CoWoS technology. These interactions might lead to TSMC securing future contracts with these sectors shortly.
What New Price Does Goldman Sachs Foresee for TSMC?
Goldman Sachs raised its target price for TSMC from $1,145 to $1,210. Trading currently at $1,080, meeting this target could result in a nearly 12% stock price increase. Analysts suggest that advances in AI and high-performance computing could greatly influence TSMC’s performance. At the same time, the company’s pioneering efforts in next-gen semiconductor technology remain a magnet for investors.
Given the fast-paced changes in the semiconductor market, TSMC’s financial metrics can vary. As a result, investors are advised to undertake thorough risk assessments when making investment choices. Responsibility for any investment-related losses lies solely with the investors.
TSMC’s ongoing commitment to innovation and strategic advances in the AI sector positions it as a significant player with promising growth; however, careful consideration of market dynamics remains essential for prospective investors.
