Taiwan Semiconductor’s Enlargement in AI and 2nm Know-how Set to Enhance Future Development, Analyst Says – Taiwan Semiconductor (NYSE:TSM)

Taiwan Semiconductor Manufacturing Co TSM will maintain a press convention on July 18.

As demand for generative AI continues to increase, UBS gave TSMC a “Purchase” ranking with a goal value of 1,070 yuan.

The “4 questions” from UBS embody the outlook for the semiconductor cycle, gross revenue margin tendencies, capital expenditure updates and order visibility for 2025, and the potential development of 2nm processes, UDN experiences.

UBS famous the semiconductor cycle will profit from stable cloud AI and high-performance computing (HPC) functions.

They count on TSMC’s gross revenue margin to rise as a consequence of increasing AI demand and superior course of expertise. UBS estimates EPS from 2024 to 2028 to be 40.14 yuan, 53.27 yuan, 60.75 yuan, 69.5 yuan, and 80.23 yuan, respectively.

UBS analyst Lin Lijun highlighted TSMC’s 2025 outlook, noting elevated income forecasts and improved demand for 2nm expertise. UBS revised TSMC’s capital expenditure from $35 billion to $37 billion, with capital depth reaching 34%.

Lin Lijun is optimistic about TSMC sustaining its place as the first CoWoS provider in 2025, with a market share of over 80%. TSMC’s wafer manufacturing capability will possible attain 40,000 per thirty days by 2024 and 55,000 by the top of 2025, courtesy of Nvidia Corp NVDA and different cloud computing functions.

Demand for TSMC’s 3nm course of stays sturdy, pushed by new merchandise from main SoC gamers, Intel Corp’s INTC outsourcing orders, and Apple Inc’s AAPL iPhone alternative cycle.

Worth Motion: TSM shares traded greater by 3.75% at $182.29 on the final verify Wednesday.

Disclaimer: This content material was partially produced with the assistance of AI instruments and was reviewed and revealed by Benzinga editors.

Picture by Ivan Marc through Shutterstock

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