Taiwan Semiconductor Manufacturing Co. (TSMC) shares reached a record high on Tuesday, putting the world’s largest contract chipmaker on track for its best annual stock performance in 25 years. The stock rose as much as 1.4% in Taipei, briefly exceeding its November 8 peak, following overnight gains in U.S. chip stocks, including key customers Apple and Nvidia. Driven by ongoing investor interest in artificial intelligence, TSMC shares are now up 84% this year.
Charlotte Yang for Bloomberg News:
“For us, TSMC remains the best way to play the AI theme without having to pick a winner or a technology, at a reasonable valuation,” said Kevin Net, head of Asian equities at Financiere de L Echiquier. The next catalyst to watch will be Nvidia’s presentation at CES 2025 next month as well as TSMC’s upcoming results and guidance, he added.
With a client list that also includes Apple Inc. and Advanced Micro Devices Inc., TSMC has been a major beneficiary of the boom in AI spending. The company is expected to report sales growth of 36% for the December quarter, with a gross profit margin at 58.3%, the highest since 2022.
MacDailyNews Take: Good news for TSMC is good news for Apple, which is, by far, TSMC’s number one customer.
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