Analysts rate Taiwan Semiconductor Manufacturing (TSM:NYE) with a Buy rating and a $94 target

Daiwa Securities rates TSM stock as a Buy.

Based on the Taiwan Semiconductor Stock Forecast from 5 analysts, the average analyst TSM stock price target is USD 94.00 over the next 12 months. Taiwan Semiconductor Manufacturing’s average analyst rating is Buy. Stock Target Advisor’s own stock analysis of Taiwan Semiconductor stock forecast is Slightly Bullish, which is based on 10 positive signals and 5 negative signals. At the last closing, Taiwan Semiconductor Manufacturing’s stock price was USD 67.44Taiwan Semiconductor Manufacturing’s stock price has changed by -1.81% over the past week, -14.09% over the past month and -38.84% over the last year.

 

About Taiwan Semiconductor Manufacturing (TSM:NYE):

Taiwan Semiconductor Manufacturing Company Limited manufactures, packages, tests, and sells integrated circuits and other semiconductor devices in Taiwan, China, Europe, the Middle East, Africa, Japan, the United States, and internationally. It provides complementary metal oxide silicon wafer fabrication processes to manufacture logic, mixed-signal, radio frequency, and embedded memory semiconductors. The company also offers customer support, account management, and engineering services, as well as manufactures masks. Its products are used in mobile devices, high performance computing, automotive electronics, and internet of things markets. The company was incorporated in 1987 and is headquartered in Hsinchu City, Taiwan.

 

What we like:

High market capitalization

TSM stock is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk adjusted returns

TSM stock has performed well, on a risk adjusted basis, compared to its sector peers(for a hold period of at least 12 months) and is in the top quartile.

Superior total returns

TSM stock has outperformed its sector peers on average annual total returns basis in the past 5 years (for a hold period of at least 12 months) and is in the top quartile.

High dividend returns

TSM stock has outperformed its sector peers on average annual dividend returns basis in the past 5 years (for a hold period of at least 12 months) and is in the top quartile. This can be a good buy, especially if it is outperforming on total return basis , for investors seeking high income yields.

Superior capital utilization

The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior return on assets

The company management has delivered better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Revenue Growth

TSM stock has shown top quartile revenue growth in the previous 5 years compared to its sector.

Superior Dividend Growth

TSM stock has shown top quartile dividend growth in the previous 5 years compared to its sector.

 

What we don’t like:

High volatility

The total returns for this company are volatile and above median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock.

Overpriced compared to earnings

TSM stock price is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced compared to book value

TSM stock price is trading high compared to its peers median on a price to book value basis.

Overpriced on cashflow basis

TSM stock price is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

Highly leveraged

The company is in the bottom half compared to its sector peers on debt to equity and is highly leveraged. However, do check the market news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.