Bernstein maintains Taiwan Semi stock with $251 target

On Monday, Bernstein SocGen Group maintained a positive outlook on Taiwan Semiconductor Manufacturing Company (NYSE:TSM), affirming an Outperform rating and a $251.00 price target for the stock. The endorsement comes as TSMC disclosed its February revenue, which showed a decline of 11% month-over-month but a significant jump of 43% year-over-year, totaling NT$260 billion. This latest revenue figure adds to the January-February cumulative total of NT$553 billion, which is 66.4% of the company’s projected midpoint revenue for the first quarter of 2025. With a market capitalization of $792.82 billion and impressive revenue growth of 33.89% over the last twelve months, TSMC continues to demonstrate strong market leadership. According to InvestingPro analysis, the company maintains a "GREAT" overall financial health score of 3.21 out of 5.

The current performance suggests that TSMC is tracking on the higher end of its historical range for this period, which typically falls between 58-71%. Should March revenues align with typical seasonal patterns, TSMC’s first-quarter revenue is poised to exceed both the midpoint of its guidance and market consensus by 3.5%. However, due to an earthquake in January, expectations are set for March’s figures to be below the seasonal norm. Additionally, TSMC has indicated that its first-quarter revenue for 2025 is anticipated to be closer to the lower end of its guidance range. The company maintains robust operational efficiency with a gross profit margin of 56.12% and trades at a P/E ratio of 22.21.

The analyst’s commentary highlighted the robust monthly sales figures as a reason for the stock’s continued appeal, despite recent disruptions. The performance in the first two months of the quarter has been notably strong, which may bode well for the company’s financial health, despite the anticipated impact of the January earthquake on March’s revenue.

Taiwan Semiconductor Manufacturing Company, also known as TSMC, is the world’s largest dedicated independent semiconductor foundry. The company’s financial health is closely watched as it is a critical supplier for many major tech companies, with its manufacturing capabilities being a key component in the global supply chain for electronics.

Investors and market watchers will be keeping a close eye on TSMC’s March revenue report to gauge the full extent of the impact from the January earthquake and to confirm if the company can indeed meet or surpass its first-quarter guidance as suggested by the current trajectory. InvestingPro data shows analyst price targets ranging from $180 to $273, with a strong buy consensus rating of 1.29. For deeper insights into TSMC’s valuation and growth prospects, including exclusive ProTips and comprehensive financial analysis, check out the detailed Pro Research Report available on InvestingPro.

In other recent news, Taiwan Semiconductor Manufacturing Company (TSMC) has announced a substantial investment of $100 billion in the United States, marking a significant expansion of its operations. This investment will fund the construction of multiple fabrication plants and a major research and development center, reflecting TSMC’s commitment to addressing investor concerns regarding semiconductor tariffs and potential involvement with Intel. JPMorgan has maintained its Overweight rating on TSMC, with a price target of TWD1,500, indicating confidence in the company’s strategic direction.

Meanwhile, Intel Corporation (NASDAQ:INTC) is reportedly in transition, with Northland reiterating an Outperform rating and a price target of $28. The firm highlighted Intel’s strategic importance and challenges, including its lag behind TSMC in semiconductor manufacturing technology. Additionally, Bernstein analysts have provided insights into the Trump administration’s proposals to support TSMC and Intel, which include the possibility of TSMC constructing a U.S.-based advanced packaging plant.

Citi analysts maintain a positive outlook on TSMC, emphasizing its role in advancing artificial intelligence technologies and its critical position in the semiconductor supply chain. These developments underscore the dynamic landscape of the semiconductor industry and the strategic maneuvers by key players like TSMC and Intel.

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